Shaktikanta Das, RBI governor announced a set of relief measures for the financialorganizationsthat have been striving to counter the economic crisis that has originated from the COVID-19 virus. The International Monetary Fund has already declaredthis era as recession period due to the damage caused to economy by the coronavirus.
RBI governor Das stated, “A war effort has to be mounted and is being mounted in order to fight against the virus, including both conventional as well as non conventional measures in the continuous battle ready mode”.
The step was accompanied by the announcement from the government for the package of Rs. 1.70 lakh crores to help the class that has been damaged badly by the pandemic.
Along with the announcement of Rs. 50,000 crores fresh TLTRO 2.0 operations, Das specified some more steps to avoid the financial strain from the system amidst this deadly pandemic. The steps are mentioned below –
- Das informed that RBI will carry out another operations round of the targeted TLTRO 2.0 for the amount of 50,000 Crores. He also mentioned that this move will be going to help maintain the cash flow of NBFCs and MFIs to the small and medium sized enterprises.
- During the announcement, Das said, “It has been decided to provide special refinance facilities for an amount of Rs 50,000 crores to National Bank for Agriculture and Rural Development (NABARD), Small Industries Development Bank of India (SIDBI), and National Housing Bank (NHB) to enable them to meet sectorial credit needs,”. The step is going to support small and finance centers to lend out money to businesses.
- The TLTRO 2.0 operations were carried out to support those financial organizations that help in financing MSMEs.
- He also stated that RBI is always available to support financially the small scale financial institutions if needed.
- The today’s announcement of RBI was based on focusing four factors that are working in order to sustain the liquidity in the system, facilitating and incentivizing adequate cash flow from the banks, simplifying the financial strain and to empowerformal functioning of markets.
- RBI governor Das also expressed his gratitude to all the front line workers and banking professionals who have been working continuously and fighting all lockdown odds to support general public.
- He also informed that no one has to worry or panic as India has adequate amount of reserves for fighting back against the crisis caused due to COVID-19 virus.
The number of COVID-19 cases has crossed 13,300 including 11,201 active cases with 1749 discharged and 437 deaths. The Prime Minister has also appreciated the move made by The Reserve Bank of India and said that it is going to benefit the farmers and poor.
