News Brief
RBI Announces Rs 50,000 Crore Liquidity Window For COVID Related Healthcare Infrastructure And Services
RBI Governor Shaktikanta Das. (Vipin Kumar/Hindustan Times via Getty Images)
As the county's healthcare system reels under the severe Covid crisis, the Reserve Bank of India (RBI) on Wednesday (5 May) announced a liquidity window of Rs 50,000 crore wherein vaccine makers, hospitals, oxygen suppliers among other healthcare stakeholders would be able to get loans at the repo rate till 31 March 2022.
The loans would be for tenors of up to three years, said the RBI Governor Shaktikanta Das during a virtual address.
Das said that banks are being incentivised for quick delivery of credit under the scheme through extension of priority sector classification to such lending up to 31 March 2022. These loans will continue to be classified under priority sector till repayment or maturity, whichever is earlier.
"To boost provision of immediate liquidity for ramping up COVID related healthcare infrastructure and services in the country, an on-tap liquidity window of Rs 50,000 crore with tenors of up to three years at the repo rate is being opened till March 31, 2022," he said.
Under the scheme, banks can provide fresh lending support to a wide range of entities including vaccine manufactures, importers and suppliers of vaccines and priority medical devices, hospitals and dispensaries, pathology labs, manufacturers and suppliers of oxygen and ventilators, importers of vaccines and COVID related drugs and logistics firms and also patients for treatment.
Banks may deliver these loans to borrowers directly or through intermediary financial entities regulated by the RBI.
He further, said that banks are expected to create a Covid loan book under the scheme. By way of an additional incentive, such banks will be eligible to park their surplus liquidity up to the size of the Covid loan book with the RBI under the reverse repo window at a rate which is 25 basis points (bps) lower than the repo rate or, termed in a different way, 40 bps higher than the reverse repo rate.
Governor Das noted that in the fight against the second wave, alleviating any constraint from the financing side for all stake holders including governments, hospitals and dispensaries, pharmacies, vaccine and medicine makers, medical oxygen manufacturers, engaged in the critical healthcare supply chain, and above all the common man who may be facing sudden spike in health expenditure, requires a comprehensive targeted policy response.
"Small businesses and financial entities at the grassroot level are bearing the biggest brunt of the second wave of infections," he said.
(This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.)
Support Swarajya's 50 Ground Reports Project & Sponsor A Story
Every general election Swarajya does a 50 ground reports project.
Aimed only at serious readers and those who appreciate the nuances of political undercurrents, the project provides a sense of India's electoral landscape. As you know, these reports are produced after considerable investment of travel, time and effort on the ground.
This time too we've kicked off the project in style and have covered over 30 constituencies already. If you're someone who appreciates such work and have enjoyed our coverage please consider sponsoring a ground report for just Rs 2999 to Rs 19,999 - it goes a long way in helping us produce more quality reportage.
You can also back this project by becoming a subscriber for as little as Rs 999 - so do click on this links and choose a plan that suits you and back us.
Click below to contribute.
Latest
