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‘Cannot Arithmetically Become An NPA In 90 Days’: Piyush Goyal Urges Revisiting Default Rule With RBI
‘Interim’ Finance Minister Piyush Goyal (Representative image) (Sanjeev Verma/Hindustan Times via Getty Images)
Union finance minister Piyush Goyal has stated that banks should not treat a borrower as a defaulter who fails to make repayment on his loans because he has not received his dues from entities like discoms, reports Press Trust of India (PTI).
These comments from the minister comes a day after the Reserve Bank of India (RBI) ruled out any possibility of revising the controversial 12 February 2018 circular that asked banks to classify a loan account as stressed if there was even a day of default.
“Law cannot be a blind, wherein in 90 days arithmetically it becomes an NPA (Non performing asset). We will also discuss this and we hope to resolve it quickly,” Goyal said.
Using the example of the power industry, he noted that a power generating company did not become a defaulter just because a distribution company (discoms) did not pay their share of the dues to the power producer.
“I think it is worth discussing with the Reserve Bank that if a payment is overdue and discom is not paying its bill, then we will have to think about NCLT and NPA,” he added.
SC To Intervene
The Supreme Court (SC) is presently hearing of a case brought by a consortium of power companies against the RBI (Reserve Bank of India) circular.
A total of Rs 2 lakh crore of thermal power plants projects are facing insolvency due to financial and operational issues and their promoter companies have found it difficult to find buyers for these assets.
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