Govt keen to boost credit offtake in festival season
Detailing the latest push from the government to ensure greater credit offtake, Sitharaman said banks along with NBFCs will sit under “shamianas” in a public place and fulfil the loan requirements of various groups.
This, she said, was being done to enable everyone to see that banks are going out and providing credit and dispel the notion that scheduled commercial banks are sitting with liquidity.
Sitharaman said that in the first phase, which will start next Tuesday and end on September 29, 200 districts will be covered. Thereafter, the next 200 districts will be covered between October 10 and 15. “So in two tranches, 400 districts of the country will have their neighbourhood NBFCs or NBFCS who operate in that area linked with banks and getting newer customers to come and take credit,” Sitharaman said, adding that banks have been told that for every one old customer, five new customers have to be brought in.
“That’s the thumb rule we have offered. That for every one customer who wants a loan, please give him. But for every new, who you give now, you will bring somebody fresh, somebody who has never taken a loan from a bank should be brought and given for the category he wants,” Sitharaman said. The FM said that junior finance minister Anurag Thakur will oversee the loan programme of PSU banks.
The government is keen to ensure that credit offtake gathers pace in the festival season to help jumpstart demand for goods ranging from consumer goods to housing and retail loans. The Centre has unveiled a string of measures to counter the impact of a slowdown in economic growth that slowed to an over 6-year low of 5% in the April-June quarter triggering call for steps to take immediate steps to bolster growth.
Regarding the relief to MSMEs, Sitharaman said an existing Reserve Bank provision empowers the banks to not declare them NPA even after the 90 days. “So if there are stressed assets MSMEs, the banks have enough powers given by the Reserve Bank to not declare him NPA and work out with them if possible to restructure his loan so that he can get out of the difficult situation,” the FM said.