Real Estate Welcomes RBI's Announcement on Restructuring Loans

<span style="font-weight: 400;">The RBI Governor in his announcements mentioned a slew of measures and schemes, such as second round of loan restructuring and other relief measures as also term liquidity facility of Rs. 50,000 crore for healthcare and SLTRO for Small Finance Banks. The focus of his

BY Realty Plus
Published - May 7, 2021 3:56 AM

The RBI Governor in his announcements mentioned a slew of measures and schemes, such as second round of loan restructuring and other relief measures as also term liquidity facility of Rs. 50,000 crore for healthcare and SLTRO for Small Finance Banks. The focus of his announcements were small businesses, individuals and MSMEs; real estate as an industry looks forward to support in form of measures which will help tide over the challenges posed by the second wave. Dr. Niranjan Hiranandani, National President, NAREDCO said, “The Reserve Bank of India (RBI) Governor Shaktikanta Das today announced COVID relief measures for small businesses, individuals and MSMEs. While doing so, the RBI Governor said, ‘RBI will continue to monitor the emerging Covid-19 situation and will deploy all resources and instruments at its command especially for the citizens, business entities, and institutions beleaguered by the second wave’. This pro-active move on his part is positive for India’s beleaguered economy, which was on path to recovery from the impact of the pandemic in 2020, but is facing the challenge of the second wave. It was heartening to hear the RBI Governor say that he is ready to go unconventional and take measures to deal with the second wave of COVID19.  RBI Governor announcing a number of schemes including the second round of loan restructuring and other relief measures are steps in the right direction; the hope is that he will also consider industries like real estate, which need similar support during these challenged times, We look forward to actions that are sequenced, calibrated and well-timed so as to reach out to industries like real estate.”  “The announcements made by the RBI Governor today reflect that the Central Bank and Government are well aware of the impact of the second wave of the pandemic, shall proactively take measures to counter the economic fallout and take necessary steps in order to revive the economy. The Rs 50,000 Cr term liquidity facility to “Ease Access to Emergency Health Services” will come as a big relief to healthcare service providers, equipment manufacturers and patients alike. The Credit to MSME and Resolution Framework 2.0 for COVID related stress assets will provide a lifeline to many struggling individuals, entrepreneurs and enterprises. CREDAI urges and expects that similar measures which shall address concerns of large businesses and labour-intensive sectors like Real Estate will be announced in days to come. We strongly believe that measures that make accounts classified as SMA 1 and SMA 2 also eligible for restructuring and interest moratorium coupled with additional liquidity under ECLGS 3.0 passed onto real estate projects will kick-start the engines of economy and job creation which are most important to offset the effects of the second wave. Also, it is high time that the Government considers reclassification of SMA across businesses as this would ease liquidity pressure on NBFCs and Banks,” said Harsh Vardhan Patodia, President CREDAI.   Rohit Poddar, Managing Director, Poddar Housing and Development Ltd on RBI's announcement on restructuring loans stated, “With the fresh challenge of the historic rise in COVID cases and shortages of vaccines owing to the fury of the second wave of the pandemic, the measures taken by RBI are well-timed. The restructuring of loans for loans under 25CR by NBFC is a smart move to ease the burden on the borrower. SMEs and MSMEs have played a critical role in driving the economy over the last few years. Furthermore, the MSME sector has had a restructuring window since March 2019, and extending it by two years would not only benefit the MSME sector but will also help the system in generating more liquidity.” Ravindra Sudhalkar, CEO, Reliance Home Finance expressed, "We welcome the Reserve Bank of India's move for onetime restructuring of loans of upto ?25 crore for individuals and small businesses under Resolution Framework 2.0. Given the current COVID-19 situation and its impact on individuals and businesses, RBI could not have done otherwise. It is a welcome move and will help the financial ecosystem".  

Tags : News/Views Real Estate Dr. Niranjan Hiranandani NAREDCO CREDAI RBI Reliance Home Finance Rohit Poddar Harsh Vardhan Patodia Government of India Poddar Housing and Development Ltd healthcare MSME Ravindra Sudhalkar Announcement Welcomes Restructuring Loans SLTRO Small Finance Banks