The Reserve Bank of India (RBI), which had announced the Resolution Framework 2.0 on May 5, 2021 for resolution of COVID-19 related stress of MSMEs as well as non- MSME small businesses, and loans to individuals for business purposes, has decided to expand the coverage of borrowers under the scheme by enhancing the maximum aggregate exposure threshold from ₹25 crore to ₹50 crore for these category of borrowers.
This has been done to enable a larger set of borrowers to avail of the benefits under Resolution Framework 2.0, the RBI said.
RBI asks banks, NBFCs to build capital buffers
While announcing the policy, RBI Governor Shaktikanta Das emphasised that in the whole process of fighting against the pandemic, the strength of the financial system was very crucial.
“Building adequate provisioning and capital buffers, together with sound corporate governance in financial entities, has become much more important than ever before, more so in the context of banks and NBFCs being at the forefront of our efforts to mitigate the economic impact of COVID-19,” he said.
“The Reserve Bank remains fully committed to creating an enabling environment in which a sound and efficient financial sector flourishes while preserving financial stability,” he added.
