COVID-19: RBI Governor Allows 3-Month Moratorium On Loans To Offset Virus Impact

The Governor of Reserve Bank Of India Shaktikanta Das, addressed a press conference on Friday at 10 am. The RBI chief’s addresses comes a day after the central government announced a coronavirus relief package of worth Rs 1.7 lakh crore. The Government had announced the package to help the poor and migrant workers tackle the financial difficulties arising from the 21-day lockdown imposed due to the coronavirus (COVID-19) outbreak.

The RBI governor assured citizens that the Indian banking system is safe and sound. “In recent past COVID-19 related volatility in the stock market has impacted share prices of banks as well resulting in some panic withdrawal of deposits from a few private sector banks. Do not panic withdraw deposits from banks. Your funds are safe.”

The RBI governor also announced a cut in the repo rate by 75 basis points and that in reverse repo rate by 90 basis points to help the economy tide over the coronavirus distress.

The RBI Governor also announced a cut of 100 basis points in the cash reserve ratio for a period of one year, a step he said will ensure sufficient liquidity in the system. CRR or cash reserve ratio is the amount of cash commercial banks have to mandatorily keep with the Reserve Bank of India.

It also permitted all commercial banks and lending institutions to allow a three-month moratorium on all loans, in view of the ongoing lockdown to protect the 130 crore people in the country from the deadly virus.

He further added that, “If COIV19 case prolongs and the supply chain could get disrupted and it could jeopardise India’s growth. We hope that drop in crude oil prices will help India.”

Also Read: Coronavirus Pandemic: India records highest deaths in a day; COVID-19 cases cross 700

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