New Delhi, Feb 11 (KNN) The NACH mandate limit increased to Rs 3 crore for TReDS settlements announced by the RBI on Thursday will support the liquidity requirement of MSMEs, said Atul Kumar Goel, MD and CEO of Punjab National Bank (PNB) sharing his overall View on RBI’s Bi-Monthly Monetary Policy

According to the bank chief, RBI policy stance to act as an enabler of investment demand and credit growth as it has decided to keep the benchmark rates unchanged for tenth time in a row with continued accommodative stance in order to revive and sustain the growth recovery as policy is at present required for broad based growth going forward.

On the banking front, RBI held that the banks in India should continue the process of capital augmentation and also focus on the governance and risk management. RBI expressed sanguinity about the health of Banks’ balance sheets and we believe that the improving capacity utilization aiding investment demand will lead to credit growth, he added. 

Speaking about Liquidity management, Goel said the announcements of the VRR and VRRR of 14 day tenor to operate as main liquidity management tool; and availability of fixed rate reverse repo and Marginal Standing Facility from 5:30-11:59 PM on all days will facilitate the better liquidity management.

Amongst other announcements, Extension of on tap liquidity for emergency health services and contact intensive sectors till June 30th , 2022 augurs well for the sector, he stated.

The other announcement of enhancing cap on e-rupee vouchers to strengthen the digitalization efforts and new directions are to be announced for CDS & participation in the offshore Foreign Currency Settled Overnight Indexed Swap (FCS-OIS) market will provide further fillip to the corporate bond market and interest rate derivative market respectively, he said. (KNN Bureau)