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28/12/2019 04:11pm

Govt launches MSME ‘Outreach Initiative' for restructuring stressed assests

image Govt launches MSME ‘Outreach Initiative' for restructuring stressed assests

New Delhi, Dec 28 (KNN) Union Finance Minister Nirmala Sitharaman on Saturday said that the government has launched Micro Small and Medium Enterprises (MSME) 'Outreach Initiative' for restructuring of stressed standard assets.
 
''In order to address the working capital needs of MSMEs on account of stress arising frm delayed payments, PSBs are offering up to 25% enhancement in working capital limits for standard MSME accounts as a Standby Line of Credit and have launched a MSME Outreach Initiative for restructuring of stressed standard assets as needed on priority and in a timely manner, besides providing new term loans, payment solutions for delayed receivables, bill discounting and trade finance,'' said the Finance ministry in a statement.
 
''A total of  5,38,440 MSME loan accounts have been restructured in terms of RBI’s circular dated 1.1.2019, out of which 1,65,104 accounts have been restructured since October, 2019,'' the statement added.
 
On Credit outreach by banks, the ministry said that Public Sector Banks (PSBs) have sanctioned over 11.68 lakh Repo-linked loans to retail borrowers for home/vehicle/education/personal loans and to micro and small enterprises, amounting to Rs 1.32 lakh crore post Finance Minister’s announcements on 23.8.2019 on measures to boost the economy.
 
All PSBs have introduced checkbox-based OTS and have sanctioned settlements under OTS in over 5.26 lakh accounts amounting to Rs 16,716 crore, post Finance Minister’s announcements on August 23 this year.
 
Meanwhile, Sitharaman asked the bank officials to not worry against any “undue harassment” from agencies. The Finance Minister along with the head of the banks held discussion with CBI director.
 
CBI has said that they will organise several discussions and seminar with bank employees to ward off their doubts about its approach against the banks. It comes days after Prime Minister Narendra Modi, as well as Finance Minister Nirmala Sitharaman, had assured bank officials of their support if the correct procedures were followed.
 
Finance minister also spoke about the “fear of three Cs: Central Bureau of Investigation, Central Vigilance Commission, and Comptroller and Auditor General.”
 
While briefing media, Finance Secretary Rajiv Kumar listed out the conclusions of the meeting. He declared that banks, including the private sector banks, have recovered Rs 2.08 lakh crore under NCLT’s provisions out of which Rs 38,000 crore were of the public sector banks.
 
13 public sector banks ran a profitable business in 2019 which is a decline frm numbers in 2018 when 19 PSBs were profitable. There was another announcement on Provision Coverage Ratio which stands at an all-time high of 76.7%.
 
The Finance Minister also announced that Merchant Discount Rate (MDR) charges will be exempted on the selected mode of payments frm January 1 adding that ''the details of the nature of transactions in the exempted list will be notified soon.''

 

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