On Saturday, the Finance Minister, Nirmala Sitharaman said that banks should give loans to all the borrowers who are eligible without worrying CBI, CAG and CVC.
She has given some clear instructions that no bank or any public financial institution should fear extending loans as the loan guarantee is given by the government itself and no individual bank will be hauled up if in case of default.
She said in the conference- “Yesterday, I reiterated that by saying, if a decision goes wrong, and if there is a loss, the government has given 100 per cent guarantee now. It is not at all going to be on the individual official and on the bank, and therefore without fear they should take this automatic route in the sense, everybody eligible for additional term loan and additional working capital should be given. The Finance Ministry has taken several steps to allay those fears including withdrawing some of the notifications which were causing fears among bankers.
..concerns these banks have had in their minds earlier, and may have even now are absolutely well founded. In fact, through my last 7-8 months, I have spent at least three different times with the banks to say that the fear of the 3Cs as they refer to the CBI, CVC, and also the CAG should not be in their minds,”
“Except agriculture and the power sectors where reforms would be undertaken, other than that I have not come up with any sectoral reference. What has now become to be called as MSME package, it includes MSME, and also aims at touching others (sectors) too,..So the sectors that you are referring to can also benefit through this. It is based on the understanding that any enterprise “with a certain exposure to the bank and with a certain invested capital, or with a certain turnover if they need additional term loan, additional working capital in order to buy their own material to restart, in order to be able to pay some fixed cost, it can take that route,” she added.