In the wake of massive economic slowdown in the country, BJP government on Friday announced various measures to ensure that loans for home, vehicles and consumption goods become cheaper.
Finance minister Nirmala Sitharaman told reporters in New Delhi that banks will pass on RBI rate cut benefits to borrowers through MCLR (Marginal Cost of funds based Lending Rate) reduction.
She said that banks will launch repo rate and external benchmark-linked loan products that will lead to reduced easy monthly installments for housing, vehicle and other retail loans.
Sitharaman further said additional liquidity support of Rs 20,000 crore to housing finance companies (HFCs) by the National Housing Bank (NHB), thereby increasing the total support to Rs 30,000 crore.
The government announced partial credit scheme for purchase of pooled assets of non-banking finance companies and HFCs up to Rs 1 lakh crore to be monitored at highest level in each bank.
The minister said that NBFCs will be permitted to use the Aadhaar authenticated bank ‘Know Your Customer’ (KYC) to avoid repeated processes.
The government has decided to make necessary changes in PMLA rules and Aadhaar regulations to ease the lending process.
“Working capital loans for industry will also become cheaper,” Sitharaman said.
To reduce harassment and bring in greater efficiency, public sector banks (PSBs) will ensure mandated return of loan documents within 15 days of loan closure.
“This will benefit borrowers who have mortgaged assets,” Sitharaman said.