Moneycontrol
Last Updated : Jan 02, 2019 08:04 PM IST | Source: CNBC-TV18

Restructuring of MSME loans will spoil credit culture: ICRA

"Total credit from the banking sector for MSME sector should be close to around Rs 10 lakh crore and apart from that there should be additional Rs 2 lakh crore from NBFCs," ICRA's Anil Gupta said.

CNBC TV18 @moneycontrolcom

The Reserve Bank of India (RBI) has allowed one-time restructuring of MSME loans, provided the total fund and non-fund based exposure to such a borrower does not exceed Rs 25 crore. Anil Gupta, Vice President at ICRA, spoke to CNBC-TV18 about the central bank's move.

"Total credit from the banking sector for MSME sector should be close to around Rs 10 lakh crore and apart from that, there should be additional Rs 2 lakh crore from the non-banking financial companies (NBFCs) also," Gupta said on January 2.

According to him, "Such a forbearance will definitely spoil the credit culture because earlier the borrowers were sticking to their repayment schedule but now with this forbearance definitely any borrower will try to get a restructuring with a longer repayment schedule. So overall it is not good for the credit culture."

Source: CNBC-TV18
First Published on Jan 2, 2019 04:59 pm
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