The Central's Narendra Modi government has issued measures to help the Covid-19 affected industry to help public sector banks avoid shocks next year. A top finance ministry official said this point. There is also debt restructuring. Financial Services Secretary Devashiesh Panda said that the epidemic has hurt the economy since its subsequent lockdown, but now there have been signs of rapid improvement in the economy.
The performance of retail, housing agricultural credit is good. In this regard, Panda said that continuous reforms are being made in the growth of credit. The performance of retail, inhabited agricultural loans is also good. In addition, the Government's Emergency Credit Facilitation Guarantee Scheme (ECLGS) intervention through other similar schemes is also improving the status of micro, small and medium enterprises (MSME) sector. Panda said the Reserve Bank is going to provide restructuring facility through corona solution scheme. By which all types of loans are going to be addressed and its impact will not be as serious as previously estimated. However, it is going to be difficult to give data on this. The Reserve Bank issued a one-time restructuring of corporate retail loans in August. These loans will not be classified as non-performing assets (NPAs).
The benefits of restructuring are going to be available to the letters that were standard accounts by March 1, which did not miss more than 30 days. Panda said, "We believe that the coming year is going to be a major setback to the public sector banks due to the high provision coverage ratio, the continued reduction in NPAs, the one-time debt restructuring." He said that the demand for debt in the corporate segment is somewhat weak. Banks are trying to improve the demand for corporate debt by the government. Now eCLGS has been expanded to more pressing areas. Banks have so far sanctioned loans worth Rs 2,05,563 crore to about 81 lakh accounts under the Rs 3 lakh crore Emergency Credit Facilitation Guarantee Scheme (ECLGS) for the MSME sector.
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