FM to meet heads of public and private sector banks on Monday

Finance Minister Nirmala Sitharaman will meet heads of public as well as major private sector banks on Monday to review flow of credit to important sectors of the economy, including MSME, automobile and housing sectors, as per an official statement.

Generally, the finance minister holds review meeting with heads of public sector banks and financial institutions, but this time the ministry has also invited major private sector lenders.

The meeting will "review matters relating to growth of credit in various important sectors of the economy, such as MSME, retail, automobiles, affordable housing, NBFC/HFCs and areas of priority for the banking sector in the coming months for accelerating GDP growth", the finance ministry said in a statement on Friday.

Meanwhile, sources said secretaries of department of revenue and corporate affairs ministry too would be attending the meeting.

In the last few months, there have been signs of revival in public sector banks.

India's largest bank, SBI has posted a profit of Rs 2,312 crore in the first quarter of the fiscal as against a loss of over Rs 4,876 crore in the year-ago period on better asset management.

State-owned banks have recovered Rs 3.59 lakh crore over the last four financial years, including record recovery of Rs 1.23 lakh crore during 2018-19, the government said in a reply to a question in Parliament recently.

The statement further said, Sitharaman will hold a meeting with stakeholders and representatives of other ministries to discuss recommendations of the U K Sinha committee report on the MSME sector.

The Sinha panel, which submitted its report to the government in June, has made over a 100 far reaching recommendations for the MSME sector, one of the largest job creating segments in the country.

The recommendations encompass various domains, such as credit, equity funding, technology, marketing, delayed payment issues, institutional arrangement, need for legislative changes, rural enterprises, and risk mitigation.

It has also suggested setting up of specific funds for the MSME sector by the government with a view to enhance their competitiveness.

As implementation of the proposals will involve inter-ministerial or inter-agency coordination, the finance minister will be meeting the stakeholders and representatives of several ministries, including MSME, MEITY, and rural development, among others.

Meanwhile, the finance minister is taking meetings with secretaries of all departments under the finance ministry daily with a view to improve inter-departmental coordination and also to discuss urgent economic issues and implementation of the budget announcements.