The Reserve Bank of India (RBI) has decided to open an “On-tap Liquidity Window for Contact-intensive Sectors” aggregating Rs15000 crores till March 31, 2022. These sectors include hotels and restaurants, tourism, rent-a-car service providers.
In the Statement on Developmental and Regulatory Policies announced by RBI on 04.06.2021, RBI Governor Shaktikanta Das announced that “In order to mitigate the adverse impact of the second COVID-19 wave on contact intensive sectors, a separate liquidity window of Rs 15,000 crore is being opened till March 31, 2022, with tenors of up to 3 years at the repo rate,”.
Under the scheme, banks can provide fresh lending support to hotels, restaurants, tourism and travel operators, adventure and heritage facilities, aviation ancillary services (ground handling and supply chains) and other services that include private bus operators, car repair services, rent a car services providers, event/conference organisers, spa clinics and beauty parlours and saloons.
Banks are expected to create a separate COVID loan book under the scheme. By way of an incentive, such banks will be eligible to park their surplus liquidity up to the size of the COVID loan book, created under this scheme, with the Reserve Bank under the reverse repo window at a rate which is 25 bps lower than the repo rate or, termed in a different way, 40 bps higher than the reverse repo rate. Banks desirous of deploying their own resources without availing funds from the RBI under the scheme for lending to the specified segments mentioned above will also be eligible for this incentive.
Das also announced a special liquidity facility to SIBDI for further supporting MSMEs, extending liquidity of Rs 16,000 crore.