Fri. Mar 29th, 2024

In order to revive the confidence of masses in the Indian economy, the Union Finance Minister Nirmala Sitharaman announced a number of fiscal measures. While addressing a meeting of heads of Public sector banks on Thursday, the minister announced that the commercial banks and NBFCs (Non-Banking Financial Company) have been directed to reach out to customers.

Banks have been asked to organize “loan melas” in the stipulated timeframe. The program will be carried out in two phases across 400 districts. The deadline of the phased campaign is 15 October. Both phases will cover 200 districts each.

Public sector banks have been ordered to organize credit “Shamiana meetings” in 400 districts which will begin from October 3. The meetings will be targeted towards providing loans to NBFCs and retail borrowers, including homebuyers and farmers. The main thrust lies on expanding the efficient credit channel in the upcoming festive season. Public sector banks have also been asked to focus on giving loans to the “RAM” category- retail, agriculture, and MSMEs. The Banks have also been directed to bring in five new customers for each existing customer.

Banks have been asked not to declare the stressed assets of MSME (Micro, Small & Medium Enterprises) as Non-performing assets till 31 March 2020. Nirmala Sitharaman said, “There already exists a circular from the Reserve Bank that provides for stressed loan accounts of MSMEs not being declared non-performing assets. We have requested at bank-level, the bank should sit with stressed MSME and work out a mechanism on how best they can come out even if it requires an additional infusion of capital.”

Discussion on the merger of 10 big public sector banks was also taken up during the meeting.

The ongoing remedial measures in the banking system are part of the big economic reforms that have been necessitated by the 6-year low GDP growth and a 45-year high unemployment rate. The economic decisions are also a part of making India a $5 trillion economy.

ALSO READ:  FM Nirmala Sitharaman asks Tax officials to practice “restraint” in tax-collection; urges them to respect wealth-creators.

By Saurabh Parmar

Digital Journalist (Specializing in Indian affairs & Contemporary Political development)

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