RBI re-opened its one-time mortgage restructuring plan for people, small companies, MSMEs
In an unscheduled deal with on Wednesday, May 5, Reserve Bank of India (RBI) Governor Shaktikanta Das introduced a number of set of measures to sort out the financial disruptions amid the second wave of the COVID-19 pandemic within the nation. The central financial institution will present term-liquidity help of Rs 50,000 crore to ease the entry of funds for emergency medical providers. This comes at a time when the healthcare system is overburdened with surging coronavirus instances. (Also Read: RBI Announces Term Liquidity Facility Of ₹ 50,000 Crore For Healthcare )
The RBI additionally re-opened its one-time mortgage restructuring plan for people, small companies, and micro, small and medium enterprises (MSMEs) at present affected by the state-wise lockdown restrictions. The small debtors having publicity as much as Rs 25 crore, who didn’t avail of the restructuring earlier and the place loans had been categorised as commonplace as of March 31, 2021, will now be eligible for mortgage restructuring within the second spherical. (Also Read: RBI Says Loan Moratorium For Small Borrowers – See Who Qualifies )
The Reserve Bank additionally relaxed KYC norms for purchasers and directed the regulated entities or banks to not impose any restrictions in case the account holders fail to replace their KYC until the tip of the yr. The RBI additionally prolonged the scope of the video KYC or V-CIP for the brand new classes of consumers together with proprietorship companies, authorised signatories, and helpful homeowners of authorized entities. (AlsoRead: RBI Relaxes KYC Norms Till End Of Year: Here’s What Customers Should Know )
Here’s what analysts and consultants must say on the RBI’s bulletins in the present day, as a part of its measures to sort out the financial disruption:
Mr. Dhiraj Relli, MD and CEO, HDFC Securities:
“The RBI Governor’s announcement did not include blanket moratorium and hence some of these fears did not come out to be true and Banking stocks did not sell-off. Small businesses and MSME borrowers have been given a chance to extend their payment schedules. Rs.50000 crore term liquidity for healthcare sector is welcome but unlikely to benefit many listed players. Overall the street may be disappointed with the financial impact of the announcement.”
Dr. Joseph Thomas, Head of Research, Emkay Wealth Management:
“The three-year facility, which the banks can advance, to the of Rs. 50,000 Crs, is a good measure to immediately help ramp up medical and healthcare facilities. The benefits of this will help enhance capacity for the longer term as it covers diagnostic, preventive as well as combative aspects of healthcare.
Omkar Shirhatti – Co-Founder and CEO – Karza Technologies:
“The rationalization of KYC compliance norms announced by RBI today was a much-needed move and is likely to impact the banking ecosystem in multiple ways. The most significant impact we foresee is a relatively substantial reduction not just in customer acquisition costs but also in operations and compliance costs. A large chunk of operational and compliance costs came from the regular updation of KYC information, something which may now be possible via mobile and internet banking by customers themselves, thus reducing those costs.
From the customer perspective, businesses and commercial entities have had to go through paper-based account opening thus far. With the change in norms, current account openings and MSME Lending can now be completely digital, giving small businesses easier access to banking facilities. We also foresee an increase in Neo Banks and Digital SME Banks. On the whole, the new norms are a move in the right direction, enabling more thorough digitization and a secure banking ecosystem.”
Shekhar Bhandari, President –Global Transaction Banking, Kotak Mahindra Bank:
“RBI’s measures announced towards rationalisation of KYC norms, especially extending scope of V-CIP, will enable banks to step up customer on boarding, as also enhance customer experience. Credit to MSMEs will increase given the relaxation announced for NDTL.
Ms. Bekxy Kuriakose, Head – Fixed Income, Principal Asset Management Company:
”Considering the big bang measures undertaken by RBI since March 2020, today’s measures are more of incremental specific targeted measures designed to provide relief where required.
For the debt market, the announcement of Rs 35,000 cr of OMO purchases under Gsap 1.0 or Government Securities Acquisition Programme was a key positive which led to the 10-year benchmark gilt closing below six per cent today. While totally quantum under Gsap 1.0 has already been announced for the quarter April to June 2021, considering RBI’s reiteration today that Policy would be channeled to targeting growth impulses market has taken announcements positively.
We expect in the near term gilt prices to remain supported given RBI measures in the backdrop of banking system liquidity and benign short-term money market rates.”
Mr. Nish Bhatt, Founder & CEO, Millwood Kane International – an investment consulting firm:
“The measures announced will support the funding requirements of the healthcare, medical facilities, beef-up vaccine manufacturing for domestic inoculation. MSMEs and individuals borrowers will benefit from the extension in the moratorium. The RBI’s intent to take further measures if need be to provide relief, focus on the post-COVID future will send the right signal for the markets..”
Mr. Vikash Khandelwal, CEO, Eqaro Surety Private Limited
”Maintaining its stance of offering financial help, the RBI Governor introduced measures to help healthcare infrastructure, defending the pursuits of small companies, particular person debtors, and safeguarding the macro-economic fundamentals. The step to categorize Small Finance Banks’ on-lending to Micro Finance Institutions (MFIs) as precedence sector lending will guarantee liquidity for small companies.”
