Union finance minister Nirmala Sitharaman today directed banks to roll out resolution schemes for Covid-related stress by 15 September.
In a video conferencing with the heads of scheduled commercial banks and nonbanking financial companies (NBFCs), the minister focused on lenders immediately putting in place board approved policy for resolution, identifying eligible borrowers and reaching out to them.
“Quick implementation of a sustained resolution plan by lenders for revival of every viable business,” reads the statement issued by the finance ministry.
She also called for a sustained media campaign to create awareness and advised lenders to ensure that regularly updated FAQs on the resolution framework are uploaded on their websites in Hindi, English and regional languages, and also circulated to their offices and branches.
The lenders assured that they are ready with their resolution policies, have started the process of identifying and reaching out to eligible borrowers, and that they will comply with the timelines stipulated by the Reserve Bank of India (RBI).
“The ministry of finance has also been engaging with the RBI to ensure that the lenders are assisted by the RBI in the resolution process,” the statement said.
The finance minister also reviewed the progress made by various lenders under ECLGS, PCGS 2.0 and subordinate debt schemes announced as part of the “Aatmanirbhar Bharat Abhiyaan”, and advised lenders to try and extend the maximum possible relief to borrowers before the festive season.
As per the government, an amount of Rs 1.58 lakh crore has been sanctioned as on 31 August under ECLGS, out of which more than Rs 1.11 lakh crore has been disbursed.
Under PCGS 2.0, bonds or commercial papers of Rs 25,055.5 crore have been approved for purchase by public sector banks so far, out of which Rs 13,318.5 crore amounting to more than 53 per cent of the portfolio pertains to bonds or commercial papers rated below “AA-“.