FM Nirmala Sitharaman to review implementation of resolution framework for COVID-19 stress in bank loans
The review by FM Nirmala Sitharaman will focus on enabling businesses and households to avail of the revival framework
August 30, 2020 / 12:28 PM IST
Finance Minister Nirmala Sitharaman (File image: Reuters)
Finance Minister Nirmala Sitharaman is set to review the implementation of the resolution framework for COVID-19-related stress in bank loans with top management of Scheduled Commercial Banks (SCBc) and non-banking finance companies (NBFCs).
“Union Minister for Finance & Corporate Affairs Nirmala Sitharaman will review with the top management of SCBs and NBFCs, the implementation of the resolution framework for COVID-19 related stress in bank loans on Thursday, September 3, 2020,” the Ministry of Finance said.
The review will focus on enabling businesses and households to avail of the revival framework on the basis of viability, necessary steps like finalising bank policies and identifying borrowers, and discussing issues that require addressing for smooth and speedy implementation, it added.
Follow our LIVE Updates on the coronavirus pandemic here
Reserve Bank of India (RBI) Governor Shaktikanta Das after the Monetary Policy Committee (MPC) meet on August 21 announced the Resolution Framework for COVID-19 related stress.
"RBI formed the "COVID-19-related resolution framework" after taking into consideration financial health of banks as well as depositors. Businesses are in a lot of stress due to COVID-19 and if they fail, it will lead to financial instability. However, if businesses are saved, they will repay loans and, subsequently, save jobs," he said.
"Bank moratorium was a temporary solution to respond to coronavirus lockdown but resolution framework is a permanent solution," he said, adding that resolution has replaced moratorium.Follow our full COVID-19 coverage here