Government's credit guarantee scheme for micro, small and medium enterprise (MSME) sector to a total amount of Rs 3 lakh crores has taken off with a robust start as the State Bank of India (SBI) alone on Tuesday (2 June) gave out loans worth Rs 3,000 crore to as many as 22,000 MSME units, reports Economic Times.
SBI chairman Rajnish Kumar on Tuesday said that the bank in a single day disbursed about Rs 3,000 crore in total to 22,000 units in the MSME sector.
"A scheme like guarantee scheme for the SMEs, it has capital implications for the banks. In a way, this Rs 3 trillion means Rs 30,000 crore further capitalisation also has happened indirectly for the banks,” Kumar was quoted in the report as saying.
Kumar also asserted that the reports painting a troublesome future for the banks with risk of a rise in non-performing assets (NPAs) were overstated. However, he also underscored that there remains uncertainty in the economy over how the next six months will shape up for the banking sector.
Further, seeking to clear the air on the perception that the banks were not lending and that they had grown risk-averse, Kumar said that there is a fine line between risk aversion and risk prudence.
"But I want to ask, is the risk aversion from the lenders or the borrowers?" Kumar said.
As you are no doubt aware, Swarajya is, all in all, a reader-subscription-backed business model and in order to make sure we build a media platform with only the best interests of India at heart, we need your backing.
And in challenging times like this, we need your support now more than ever—to continue bringing you stories that are often shrugged off.
For us to invest in quality reporting and continue bringing you the right stories, it takes a lot of time and money.
Partner with us, be a patron or a subscriber. We need your support, throughout.