Business

RBI Will Not Like A Situation Of 'Loose' Liquidity: RBI Governor Shaktikanta Das

PRERNA YADAV | 1
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| January 7 , 2019 , 14:38 IST

RBI Governor Shaktikanta Das, while addressing the press on Monday after a meeting with representatives of small- and medium-sized businesses said that the Central Bank will quell any liquidity crisis in the economy.

He further said that he met MSME association and they mentioned some issues related to their functioning and even reviewed restructuring scheme for MSME's.

" We also have constituted a committee to look into the issues related to the Micro, Small and Medium Enterprises (MSMEs). We are looking at what kind of governance reforms can be brought about in the functioning of the banks."

In a new year gift to the MSME sector, the Reserve Bank last week allowed a one-time restructuring of existing debt up to Rs 25 crore for the companies which have defaulted on payment but the loans given to them have continued to be classified as standard assets. 

The Governor informed that he will meet the representatives of the NBFC industry on Tuesday in Mumbai and discuss the prevailing liquidity condition with them.

" I will meet non-banking financial company (NBFC) representatives in Mumbai tomorrow, we will discuss the liquidity issue of NBFCs. Liquidity conditions are being monitored constantly."

On the issue of farm loan waivers, he said that individual states should decide its fiscal space to undertake farm loan waiver and thus rejected the idea of any generalised write off for farm loans as it would have an adverse effect on the credit culture of the banking system.