RBI Governor Shaktikanta Das Speech, Announcements: The Reserve Bank of India (RBI) announced a term liquidity facility of Rs 50,000 crore for access to emergency health security.
Reserve Bank of India (RBI) Governor Shaktikanta Das on Wednesday announced measures to ease the economic stress of the second wave of Covid-19 in India. The central bank chief announced a term liquidity facility of Rs 50,000 crore for access to emergency health security.
Das said that to ramp up the Covid related healthcare infrastructure in the country, an on-tap special liquidity facility of Rs 50,000 crore will be made available to the banks at the repo rate with up to 3-year tenor till March 31, 2022.
During his address, the RBI governor said that India had flattened the COVID-19 infection curve in March, however, new mutants of the virus have emerged. He said that wide-ranging and swift actions are needed against the spread of the second wave of Covid.
The governor said that the RBI will closely monitor the emerging developments in the economy and use all resources and instruments at its command.
Das also announced special long-term repo operations for small finance banks (SFBs) to provide further support to micro, small and other unorganized sector entities. He said that SFBs will be allowed to lend to small microfinance institutions (MFIs) having an asset size of Rs 500 crore.
The RBI will also conduct a special 3-year long-term repo operation (LTRO) of Rs 10,000 crore at repo rate for SFBs. There will be a limit of Rs 10 lakh per borrower and the facility will be available till October 31, 2021.
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