Dedicated team to assess credit flow to MSMEs: Goyal

New Delhi [India], June 19 (ANI): Union Finance Minister Piyush Goyal on Friday said a dedicated team of officers will discuss aspects related to credit flow to the micro, small and medium enterprises (MSMEs) sector, which is a major focus of the banking system and economy.

"A team will discuss various aspects of credit flow, particularly to MSMEs, which is also a very critical focus area of the banking system and economy," he said at a press conference here.

Goyal further said a major concern of Public Sector Banks has been to get into the act of working to support MSMEs and genuine good companies who need working capital finances or loans on investment in fixed assets.

The finance minister also said that after a discussion with the heads of PSBs from West and South India in Mumbai, two subcommittees were formed to study the possibility of creating an asset reconstruction company or asset management company to support the resolution of Non-Performing Assets (NPAs).

"All banks have collectively decided that in two stages, they will take up the credit needs of genuine, deserving, well performing and good companies. In the first stage, banks will take up credit needs of companies who have borrowings between Rs.200 crores and Rs. 2,000 crores. In the second stage they will take accounts with borrowings up to Rs.200 crores, which will also cover MSMEs in large measures," he added.

Goyal said the bankers have decided to do a creditors agreement or arrangement amongst themselves, so that earlier problems which were faced in consortium lending can be ironed out more smoothly.

"The bankers have decided that a decision taken by 66 percent of the lenders will now be followed by all lenders in a consortium, and roadblocks will not be created, thereby spurring growth of business and industry in the system," he said.

The Union Minister informed that the State Bank of India (SBI) has offered to support the smaller banks that may not have robust risk assessment practices or credit assessment practices through its high-quality capabilities.

"Public money is extremely safe in PSBs. The government stands behind PSBs one hundred percent, and assures that public money is extremely safe. Government-owned bank deposits are 100 percent safe and secure," he claimed.

"Government stands 100 percent committed to support each and every one of our PSBs and to ensure the viability and successful future of every PSU Bank, particularly because they are the engines which take financial inclusion to the last man at the bottom of the pyramid," added Goyal.

Earlier this month, the Union Minister had said the government is committed to supporting all state-run banks and will set up a dedicated mechanism to tackle bad loan issues.

Addressing the heads of top PSBs in Mumbai, the interim finance minister said all bankers are eager to set up a mechanism for faster resolution of stressed accounts. (ANI)

This story has not been edited. It has been published as provided by ANI