New Delhi: Aiming to boost lending and improving liquidity situation, Finance Minister Nirmala Sitharaman on Friday announced upfront capital infusion of Rs 70,000 crore into public sector banks.
Speaking at a press conference, Sitharaman said the move is expected to generate an additional lending and liquidity in the financial system to the tune of Rs 5 lakh crore.
Repo rate and external benchmark-linked loan products would be launched and this willĀ reduce monthly installments for loans, such as housing, vehicle and retail. Also, through MCLR reduction, the banks have decided to pass on RBI rate cut benefits to borrowers. She also said that for the benefit of industries, working capital loans will be made cheaper.
Looking to bring in greater efficiency and to help borrowers who mortgage their assets, the public sector banks will ensure that loan documents are returned within 15 days of loan closure.