Video Editor: Purnendu Pritam, Mohd Ibrahim
The Reserve Bank of India was expected to make some big announcements as 31 March was very close. In the times of coronavirus outbreak and economic slowdown, we can expect the government, the RBI and other regulatory bodies to give packages. Right on schedule, the RBI announced a slew of measures to fight the coronavirus pandemic.
Big Announcements by RBI
The RBI has given three extra months to the borrowers in which they can pay off their loan. This allows banks to avoid declaring them as NPAs (Non-Performing Assets). Earlier, the RBI had taken many steps to expand liquidity and maintain financial stability. Now, the RBI has cut the repo rate and the reverse repo rate.
Repayment of Loans
The RBI also said that lending institutions could postpone or defer their loan repayment times. There will be change in the floating rates also. All this is being done because common people may be unable to pay their EMIs. However, no waiver was given on interest rates.
RBI’s Assurance on Private Banks
Because of the Yes Bank crisis, depositors have lost confidence in private banks. To generate faith among people, the RBI assured that peoples’ money in private banks is safe.
Fight With COVID-19
It is important to fight COVID-19 and all these steps are being taken to revive the economy. Since economic activities have taken a hit, we will see a long term effect of this. The steps taken by RBI were necessary and timely.
(At The Quint, we question everything. Play an active role in shaping our journalism by becoming a member today.)