Shaktikanta Das, the Governor of the Reserve Bank of India (RBI,) on the 17th of April, addressed the media to announce some economic measures in the wake of the extended lockdown.
Highlights of RBI Governor’s press meet:
RBI announced financial aid of Rs. 50,000 crore booster package for medium and small enterprises to recover from the lockdown duration.
The RBI announced reduction in fixed reverse repo rate, the rate of interest at which the Central Bank, the RBI, borrows money from commercial banks in India. The reduced rate under the liquidity adjustment facility (LAF) is at 3.75 % from the previous 4 %, reduced by 25 basis points.
RBI to soon announce new prevention measures to maintain liquidity, maintain bank financial flow providing relaxation to economic flow post lockdown.
The RBI announced Rs. 25,000 crores to National Bank for Agriculture and Rural Development (NABARD,) Rs. 15,000 crores to Small Industries Development Bank of India (SIDBI) for refinancing commercial banks and Rs. 10,000 crores to National Housing Bank (NHB.)
No dividend payouts for commercial banks from the profit of Fiscal Year (FY) 2020-2021.
Period of resolution timeline to be exceeded by 90 days. However, the duration of lockdown would not be counted as the resolution timeline period.
RBI Governor said, Liquidity Coverage Ratio (LCR) reduced from 100 % to 80 % due to the lockdown in the wake of the spread of the COVID-19.
Non Banking Financial Companies (NBFCs) could grant relaxed non performing asset (NPA) classification to their borrowers in moratorium or loans.
Shaktikanta Das while concluding the press meet assured economic growth in next FY. The RBI is also monitoring the situation closely and would come with other financial relaxations if needed considering the situation.
Stay tuned for further updates.
