Banks seek Credit Guarantee Fund for agri sector

Finance and Corporate Affairs Minister Arun Jaitley said the Central Government has decided to take a massive step to recapitalize the Public Sector Banks (PSBs) in a front-loaded manner.

The Government has decided to infuse capital worth Rs.2.11 lakh crore in PSBs in next two years through budgetary provisions of Rs.18,139 crore, and Rs.1,35,000 crore through Re-capitalisation Bonds. The balance would be capital raising by banks from the market.

Jaitley was making the Opening Remarks during his 7th Pre-Budget Consultation Meeting with the representatives of the Banks and the Financial Institutions (FIs) in New Delhi on 15 Dec 2017.

Capital adequacy of the banks will help in credit growth and job creation among others, he pointed out.

Suggestions from bank representatives included a Credit Guarantee Fund to encourage investment in Agriculture sector, and tax benefits for affordable housing and rental properties.

They also suggested to incentivise digital transactions to make 2018 as a year of Paperless Access to Finance; it was suggested to extend the date of Masala Bond TDS (Tax Deducted at Source) which expires in June 2018. fii-news.com