GECL MSME Loans, No borrowers – SBI Chairman Mr Rajnish Kumar has said that Bank is Ready to Lend to borrowers but the customers don’t want to take risk as they are sure about the speedy recovery in demands. Banks especially Public Sector Banks has made the loan processing under Guaranteed Emergency Credit Line (GECL) simple and easier than before. Despite these efforts, MSMEse are not ready to take loans. State Bank of India (SBI) Chairman Rajnish Kumar has accepted this matter.
Reserve Bank has cut the repo rate twice in lockdown only. Currently the repo rate is at 4 percent, which is the lowest level till date.
GECL MSME Loans – SBI chairman Views
SBI chairman Rajnish Kumar has said that banks are ready to give GECL loans, but customers are not coming forward to take loans. Along with this, Rajneesh Kumar has also reacted to the criticisms of keeping the bank deposits with the Reserve Bank. He said, “We have funds, but there is no demand for loans.” In such a situation, there is no option but to keep the money of the banks with the Reserve Bank. As far as customers are concerned, they do not want to take risks right now. ”
Let us tell you that there has been criticism that the banks are not giving the relief given by the Reserve Bank on the repo rate to the customers properly. Banks want to earn more profit by depositing their funds with the Reserve Bank. This profit is called reverse repo rate. However, recently the RBI has reduced the reverse repo rate from 4 per cent to 3.75 per cent.
GECL MSME Loans – Less motivation towards moratorium
Recently, the SBI chairman had said that only 20 per cent of the bank’s borrowers have opted for moratorium. Meaning that only 20 percent are customers who are interested in postponing the loan. Let us tell you that the Central Reserve Bank has given exemption for customers to postpone the EMI payment of the loan for 6 months (Moratorium). Earlier this facility was given from 1 March 2020 to 31 May 2020. But now it has been extended till 31 August.
Also Read – How Will Rs 3 Lakh Crore Emergency Credit Line (GECL) Work ?