Companies and industry associations have welcomed the steps taken by the Reserve Bank of India (RBI) to deal with the economic impact of COVID-19.
Chandrajit Banerjee, Director General, CII, said “The RBI’s continued resolve to ensure that the availability of liquidity, especially for stressed sectors, remains adequate is commendable. The launch of the TLTRO 2.0 is expected to ensure that MFIs and small and mid-sized NBFCs remain well lubricated.
“[The] RBI Governor has done his side of the job perfectly. Now, the end beneficiaries will have to wait to know how the benefits percolate and how soon. The RBI, government and FIs [financial institutions] need to think out of the box in ensuring that the funds flow into MSMEs quickly as we have only 12 days left for month-end commitments,” said K.E. Raghunathan, past national president, All India Manufacturers Organisation (AIMO).
Thomas Muthoot, founder and director, Muthoot Pappachan Group, said, “The overarching objective to ensure smooth flow of finance especially to the vulnerable and disadvantaged, really warmed our hearts as our various group NBFCs are driven by the avowed single-minded purpose of helping the common man.”
Akshay Mehrotra, CEO, EarlySalary said, “As a fintech lender and small NBFC, we need much more support to emerge stronger in these times. We are hoping SIDBI and PSU bank funds will trickle down to smaller NBFCs like us. The much needed support to realty-focused NBFCs with a one-year extension for delayed projects will help. Unfortunately, suspense still abounds moratorium to NBFCs.”
Rajiv Agarwal MD and CEO Essar Ports Ltd., said "The measures are the much needed stimulus at a time when the economy needs some stringent regulatory norms to induce a revival. The decision to provide special finance facility of ₹50,000 crore to financial institutions should result in more funds being available for the corporate sectors.”
Anirban Chakraborty, Managing Director & CEO, Tourism Finance Corporation said, “The announcement brings much needed relief to the sectors with an eye on the developing situation at the ground level. We, however await more sector-specific relaxations in the immediate future.”
TVS Group chairman Venu Srinivasan said it was a sign of continued efforts to stimulate economic activity and protect jobs.
“The long-term repo operation (LTRO) for non-banking financial companies (NBFCs) and micro-lenders is a good tool to ease liquidity without tinkering with policy rates, and ₹50,000 crore is a substantial amount. This should restore confidence, especially among MSMEs that provide a significant portion of the country’s jobs and is integral to all supply chains,” he said.
“The tone of RBI is one of empathy and support to needy sectors. The targeted LTRO focused on mid-sized NBFCs and micro-finance institutions is positive. The 90-day extension in non-performing assets reckoning for stressed standard assets as on March 1 effectively postpones NPA classification for accounts that were slipping into NPA between March and May,” said Padmaja Chunduru, MD & CEO, Indian Bank.
It is a timely move by RBI, said D. Lakshminarayanan, MD, Sundaram Home Finance. Additional funds to housing finance companies via the National Housing Board is a confidence-boosting move, he added.
