RBI Governor held meeting with MD/CEOs of banks to discuss on three months moratorium

Today (May 2, 2020), RBI Governor Shaktikanta Das held meeting with the MD/CEOs of major public and private sector banks in two separate sessions through video conference. The meetings were attended by Deputy Governors and other senior officers of RBI. The move comes after an apex court direction to the regulator that the intended beneficiaries get their due.

The Governor in his opening words appreciated the efforts of banks in ensuring normal to near-normal operations during the lockdown period. The meeting took stock of the current economic situation, Credit flows to different sectors of the economy, implementation of several steps announced by the RBI, as well as post lockdown credit flows including the provision of working capital, with special focus on credit flows to MSMEs, moderation in the interest rate and its transmission, as well as liquidity infusion measures to support the industry.

During the meeting, bankers discussed among other matters, implementation of three months moratorium on repayment of loan instalments announced by the RBI, including liquidity to Non-Banking Financial Companies, Micro Finance Institutions, Housing Finance Companies, Mutual Funds, etc. This was in the light of Supreme Court had recently asked the RBI to ensure that every borrower gets the moratorium benefit in “letter and spirit.” Several lenders, both public and private sector banks were earlier not in favour of extending the three-month payment holiday to non-banking finance companies and microfinance firms.

In today’s meeting, the central bank also discussed on monitoring of overseas branches of banks in view of the slowdown in economies across the globe and stability of the financial sector. The banking regulator has also called a separate meeting with leading NBFCs and microfinance firms along with their industry organisations, which have been pleading the authorities for getting the moratorium benefit from their lending banks.