RBI declared TLTRO 2.0 worth Rs 50,000 Crore, says RBI Governor

As India entered into the second phase of a nationwide lockdown to fight against coronavirus, Reserve Bank of India (RBI) Governor Shaktikanta Das today announced new measures to boost liquidity, expand bank credit flow and ease financial stress. To benefit NBFCs and micro-financial institutions, the central bank said it will conduct Targetted Long-Term Repo Operations (TLTRO) 2.0 worth ₹50,000 crore in it. After cutting the benchmark lending rate by 75 bps three weeks ago, the RBI today cut the reverse repo rate to 25 basis points to 3.75%. The central bank has also asked all banks to not make any dividend payments to shareholders keeping in mind the financial challenges during the Covid-19 pandemic.

Highlights of the conference:

  • RBI will monitor evolving situation continuously, use all its tool to deal with pandemic fallout, says RBI Governor Shaktikanta Das.
  • Earlier on March 27, RBI had slashed the repo rate by 75 basis points to 4.40 per cent from 5.15 per cent to help the economy fight the Covid-19 pandemic. Simultaneously, the reverse repo rate was cut by 90 basis points to 4 per cent from 4.90 per cent to ensure that banks don’t passively park funds with RBI and start lending to the productive sectors of the economy.
  • It has been decided to provide special refinance facilities for an amount of Rs 50,000 crores to National Bank for Agriculture & Rural Development, Small Industries Development Bank of India, and National Housing Bank to enable them to meet sectoral credit needs.
  • Shaktikanta Das said the benefits of the earlier TLTRO scheme went largely to PSUs or large corporations. He promised to step up the TLTRO 2.0 should the need arise for making more capital available to the shadow banking and microfinance sectors.
  • Automobile production, sales declined sharply in March; electricity demand has fallen sharply: RBI Governor
  • India is expected to post sharp turnaround in 2021-22, says RBI Governor quoting IMF projection.
  • As India entered into the second phase of a nationwide lockdown to fight against coronavirus, Reserve Bank of India (RBI) Governor Shaktikanta Das today announced new measures to boost liquidity, expand bank credit flow and ease financial stress. To benefit NBFCs and micro-financial institutions, the central bank said it will conduct Targetted Long-Term Repo Operations (TLTRO) 2.0 worth ₹50,000 crore in it. After cutting the benchmark lending rate by 75 bps three weeks ago, the RBI today cut the reverse repo rate to 25 basis points to 3.75%. The central bank has also asked all banks to not make any dividend payments to shareholders keeping in mind the financial challenges during the Covid-19 pandemic.

Tweets on RBI’s decision:

“Today’s announcements by @RBI will greatly enhance liquidity and improve credit supply. These steps would help our small businesses, MSMEs, farmers and the poor. It will also help all states by increasing WMA limits” PM Modi.

“There was much sneering when @DasShaktikanta was made RBI chief. Over a short period, he’s proven to be not just worthy of the job, but a particularly good choice. Solid, calm & non-doctrinaire. Important: no headline-hunting, while being accessible & communicative as well” Shekhar Gupta.

“Extremely constructive & positive 2nd set of interventions by RBI Governor @DasShaktikanta to address financial impact of Covid-19 pandemic.Accurate assessment of conditions & immediate prognosis by him. Right-sized help to pain points & will help improve liquidity in economy” Amitabh Kant

Every person having authority is giving it’s best in order to overcome the outbreak of corona. Citizens of India should also give their best and cooperate with nation.

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