PM to talk credit flow, economy with heads of banks, NBFCs today1 min read . Updated: 29 Jul 2020, 06:51 PM IST
The discussion will cover topics like credit products and financial empowerment via technology
NEW DELHI : Prime Minister Narendra Modi will meet the heads of top private and public sector banks, non-bank lenders and officials from the finance ministry over videoconference on Tuesday to discuss credit flow and steps to revive the economy.
An official statement said that the discussion include credit products and efficient models for delivery, financial empowerment through technology, prudential practices for stability and sustainability of the financial sector.
“Banking sector plays an important role of in contributing to India’s economic growth through financing infrastructure, agriculture, local manufacturing including MSMEs. Financial inclusion can play a big role in financial empowerment through technology," it said.
Financial services secretary Debasish Panda and the heads of State Bank of India, Punjab National Bank and Bank of Baroda, among others, are expected to attend the meeting.
In the last two weeks, Modi chaired a series of meetings with top officials from the finance ministry, Prime Minister’s economic advisory council, government’s policy think tank NITI Aayog, commerce ministry, as well as key ministers to draw up a strategy and action points towards revival of the Indian economy.
The meeting comes amid a growing clamour for a one-time loan restructuring from banks, as businesses reel from covid-19-induced shutdowns.
The Reserve Bank of India (RBI) also expects bad loans to rise sharply due to the disruption caused by the pandemic.
Last week, it said non-performing assets are expected to rise to a 20-year high to 12.5% of total advances by March 2021.
RBI warned that if economic conditions worsen further, the ratio may soar to 14.7% under the very severely stressed scenario.
A senior government official told Mint that banks will get more clarity on its possibility of defaults from September—when the six month loan moratorium gets over.