The Finance Minister Nirmala Sitharaman on Friday said that the government will infuse ₹70,000 crore capital into public sector banks (PSBs) in the current financial year to be able to lend more.
In the last four years, the government has the taken steps to recognise bad loans transparently, resolve and recover value from stressed accounts through clean and effective laws and processes, as well as re-capitalise banks, the finance ministry had said.
“Over the last five financial years, PSBs have been recapitalised to the extent of ₹3.19 lakh crore, with infusion of ₹2.5 lakh crore by the government and mobilisation of over ₹66,000 crore by PSBs themselves," the finance minister has said in the Parliament last month.
Sitharaman said that banks recovered as much as ₹4 trillion in the last four years under Insolvency and Bankruptcy Code (IBC) and six banks have come out prompt corrective action (PCA) framework that had restricted banks to lend further.
Going ahead, the government will announce reforms on governance and towards ‘ease of living’, banks will provide services such as doorstep banking and giving online personal loans.
Besides, in a bid to empower account holders, the government will initiate steps to address issue pertaining to unwanted deposits of cash into bank accounts.
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