RBI decides to extend special liquidity facility of Rs 16,000 cr to support MSMEs funding requirements
New Delhi, Jun 4 (KNN) The Reserve Bank of India (RBI) has decided to extend a special liquidity facility of Rs 16,000 crore to support funding requirements of MSMEs.
''To further support the funding requirements of Micro, Small and Medium Enterprises (MSMEs), particularly smaller MSMEs and other businesses including those in credit deficient and aspirational districts, the RBI has decided to extend a special liquidity facility of Rs 16,000 crore to SIDBI for on-lending/ refinancing through novel models and structures,'' RBI Governor Shaktikanta Das during the Monetary Policy Committee announcements on Friday.
“This facility will be available at the prevailing policy repo rate for a period of up to one year, which may be further extended depending on its usage,” the RBI added.
To nurture the still nascent growth impulses and ensure continued flow of credit to the real economy, the Reserve Bank had extended fresh support of Rs 50,000 crore on April 7, 2021 to All India Financial Institutions (AIFIs) for new lending in 2021-22. This included Rs 15,000 crore to the Small Industries Development Bank of India (SIDBI).
On May 5, the central bank had announced Resolution Framework 2.0 providing for resolution of COVID-19 related stress of MSMEs as well as non-MSME small businesses and loans to individuals for business purposes.
''To enabling a larger set of borrowers to avail of benefits under Resolution Framework 2.0, the RBI has now expanded coverage of borrowers by enhancing maximum aggregate exposure threshold from Rs 25 crore to Rs 50 crore for MSMEs, non-MSME small businesses and loans to individuals for business purposes,'' the governor added.