Categories: Business

Finance Minister announce rs 45 thousand cr package for NBFC

Photo: TWITTER / @ ANI

package for NBFC

new Delhi. Finance Minister Nirmala Sitharaman on Wednesday announced a special cash scheme of Rs 30,000 crore for non-banking financial companies (NBFCs) and micro finance companies offering micro funds. The objective of this step is to provide assistance through loans to the region amid Corona virus crisis. He also announced a Rs 45,000-crore partial loan guarantee (Partial Credit Guarantee) Scheme 2.0 for NBFCs, housing finance companies (HFCs) and micro finance institutions (MFIs) with lower level credit ratings. The objective of this initiative is that these companies can provide more credit support to individuals and units of MSME (micro, small and medium enterprises) sector.

The minister said that under the special cash scheme of Rs 30,000 crore, investment will be made in the investable bonds of these institutions. The government will fully guarantee these security. Sitharaman said that this would provide cash to these institutions and create a trust in the market. He said that these institutions face difficulties in raising money from bond markets. Regarding Partial Credit Guarantee Scheme 2.0 (PCGS), Sitharaman said that NBFCs, HFCs and MFIs with low credit need cash to lend to people and MSMEs. The existing PCGS will be expanded to bring the bonds / commercial papers of these units under its purview. He said that the first 20 percent loss will have to be borne by the guarantors and that is the government. Under this, bonds with ratings of AA and below (including those without ratings) will be eligible for investment. It is beneficial for MFIs. These measures are part of the Rs 20 lakh crore incentive package announced by Prime Minister Narendra Modi on Tuesday.

This post was published on May 14, 2020 1:32 am

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