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Govt may announce UPA-style bailout of stressed NBFCs in Budget 2020

Note suggests liquidity support, govt guarantee for securities issued by SPVs

NBFC
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The proposals have been discussed at the highest level in the finance ministry and are likely to find mention in the Union Budget due in February next year

Sanjeeb MukherjeeArchis MohanArup Roychoudhury New Delhi
The government has strongly advocated direct intervention by the Centre in stressed non-banking financial companies (NBFCs) on the lines of the model followed by the United Progressive Alliance (UPA) government under then finance minister Pranab Mukherjee in 2009.

“A direct intervention approach for the cause of financial stability will help reduce the stress challenging the sector, enable liquidity provision, and reduce refinance risk for solvent entities,” says a note circulated by the government to the Parliamentary Committee on Finance last week.

The proposals have been discussed at the highest level in the finance ministry and are likely to find mention

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First Published: Nov 28 2019 | 10:42 PM IST

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