Nirmala Sitharaman urges big firms to clear Rs 40,000 crore MSME dues

Banks have enough cash, says FM Sitharaman; weighs credit line for NBFCs.

Agencies
Finance minister Nirmala Sitharaman
New Delhi: Finance minister Nirmala Sitharaman has said banks have sufficient liquidity, and efforts are being made to ensure that large firms clear their dues to the micro, small and medium enterprises (MSMEs).

The corporate affairs ministry will approach the large companies that owe MSMEs close to Rs 40,000 crore. The government will also look at bankers for suggestions on allowing non-banking finance companies (NBFC) with good pooled assets but poor institutional rating to become eligible under the Centre’s one-time partial credit guarantee scheme.

“Banks have sufficient liquidity,” she said. The banks have been asked to provide bill discounting facility to the MSMEs against these payments from big corporates. She said all efforts would be made to ensure that the dues are cleared before Diwali. Finance secretary Rajeev Kumar said state-run banks have seen good response with disbursements at Rs 81,781 crore in nine days and will now hold the second round of outreach programme before Diwali, from October 21 to 25.


ON PMC CRISIS
Sitharaman said she is keeping a close watch on the developments at Punjab & Maharashtra Co-operative Bank and spoke to the Reserve Bank of India governor on Monday. “I had a discussion with the RBI governor this afternoon… He has assured me that he will keep the interest of customers in mind and try to resolve it at the earliest... And, I am closely monitoring it,” she said after a meeting with heads of public sector banks here.

PMC Bank was put under “directions” by the RBI last month because of its weak financial health. “The government has been on its toes in terms of bringing the assets of these promoters (indulged in fraud) of the bank... Process will not suffer for want of enough assets which can eventually help paying back customers.

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In fact, my appeal to the governor this afternoon was if there are so many assets, (then) is there anyway RBI can expedite in terms of paying to customers who are genuinely suffering,” the finance minister said. She said the government could consider raising the deposit guarantee limit from Rs 1 lakh now. If it happens, then it will be through Parliament, she pointed out.

ON NBFCS
Sitharaman said banks have suggested those NBFCs having investment-grade ratings but with AA-rated assets be included in the par tial credit guarantee scheme to provide them liquidity.

Banks have purchased assets to the tune of Rs 17,000 crore from the NBFCs under the direct pooled buyout so that the NBFCs also get the liquidity, finance secretary Kumar said, adding that Rs 15,455-crore worth of assets have been identified by the banks.
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