New Delhi: After a meeting with the heads of several public sector banks to review developments under the recent bank mergers, Union Finance Minister Nirmala Sitharaman on Thursday addressed a press conference to discuss the updates.
Talking about the challenges faced by the ministry regarding the bank mergers, Sitharaman said that the liquidity situation of the economy was being looked at and there are banks working with NBFCs to find out different ways of public lending.
“In 200 districts of the country between now and 29 September, there shall be gathering which banks will have of NBFCs with whom they have tied up and given liquidity and retail customers of the bank…to encourage customers to come, who want newer credit to be extended,” she said announcing a public outreach campaign in 400 districts by banks and NBFCs to aid borrowers including homebuyers and farmers with credit benefits.
Retail customers can come to and avail loans at the open-house public spots, hopefully, in “shamiana” gatherings for people to able to see. The next set of 200 districts will happen between October 10 and October 15, she announced.
Sitharaman also announced that banks will not declare stressed loan accounts of MSME as NPA till the end of the current fiscal year, i.e., March 2020, as mentioned in an existing RBI circular. Instead, work will be focused on recasting their debt.
“We have also requested that the bank should make an effort to sit with such stressed asset MSMEs & work it out with them to get them out of that situation,” she said.
Earlier this month, the finance minister announced a mega bank-merger plan to amalgamate 10 state-run public sector banks into four large entities to address economic concerns. As per the merger announcement, Punjab National Bank will take over Oriental Bank of Commerce and United Bank of India, Syndicate Bank will take over Canara Bank. Similarly, Union Bank of India will merge with Andhra Bank and Corporation Bank; and Indian Bank with Allahabad Bank.