Hyderabad: Hailing the comprehensive announcement made by the RBI Governor Friday, Federation of Indian Exports Organisation ( FIEO) President Sharad Kumar Saraf said that it will hugely benefit not only the banking system but also the Indian economy.
The reduction in the Repo rate by 75 basis points to 4.4 per cent and Reverse repo by 90 basis points to 4 per cent will reduce the cost of credit. The reduction in CRR by 100 basis points to 3 per cent for 1 year to release 1.37 lakh crores will address the liquidity, which is the need of the hour, the FIEO Chief in a statement here.
Three months moratorium on payment of installments of Term Loan outstanding, deferring of Interest on Working Capital facilities by 3 months and not considering such deferment for NPA will benefit all particularly the MSME. Mr Saraf suggested that RBI may clarify that deferment of interest on Working Capital covers pre-shipment exports credit also.
President FIEO said that RBI acknowledges that the world economy is standstill and many countries will soon be in recession and, therefore, should bring a separate relief package for exporters providing them relief from interest and penalties on overdue export bills, forward booking of foreign currency etc. All pre and post shipment finance to exporter to have extended due date by 90 days on auto route, observed Mr Saraf.
Bank should not charge interest on month end basis. Interest to be charged after 30 June, 2020 on all types of loans. No interest to be debited from today till 30 June on any of exim loans, the statement added.
