Finance Minister Nirmala Sitharaman Friday announced a slew of measures to ensure that loans for home, vehicles and consumption goods become cheaper and widely available through banking and non-banking finance companies.
Making announcements on RBI rate cut benefits, the finance minister said banks will pass on RBI rate cut benefits to borrowers through MCLR reduction.
Monthly installment for housing, vehicle loans reduced
Addressing a press conference, Finance Minister Nirmala Sitharaman Friday said banks will launch repo rate and external benchmark-linked loan products. The move will lead to a cut in easy monthly installments for housing, vehicle and other retail loans.
Further, the finance minister also announced 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.
Partial credit scheme for purchase of pooled assets
Finance Minister Nirmala Sitharaman 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 the highest level in each bank. Prepayment notices issued to NBFCs will be monitored by banks, the finance minister said.
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 the industry will also become cheaper," Sitharaman said.
To reduce harassment and bring in greater efficiency, public sector banks (PSBs) will ensure the mandated return of loan documents within 15 days of loan closure.
"This will benefit borrowers who have mortgaged assets," Sitharaman said.
Watch Finance Minister Nirmala Sitharaman's full press conference