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RBI extends fresh support of Rs50,000 cr. to NABARD

Posted on April 9, 2021 by admin1  643

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The RBI has said it would extend fresh support of Rs50,000 crore to the All India Financial Institutions for new lending in FY22.

  • The move is aimed to mitigate the impact of the pandemic and aid economic revival.

About

  • Accordingly, NABARD will be provided a special liquidity facility (SLF) of ?25,000 crore for one year to support agriculture and allied activities, the rural non-farm sector and non-banking financial companies-microfinance institutions.
  • An SLF of ?10,000 crore will be extended to the National Housing Bank for one year to support the housing sector.
  • SIDBI will be provided ?15,000 crore under this facility for up to one year for funding of micro, small and medium enterprises (MSMEs).
  • All three facilities will be available at the prevailing policy repo rate.

National Bank for Agriculture And Rural Development (NABARD)

  • About: It is an apex regulatory agency for Regional Rural Banks and Cooperative Banks under the jurisdiction of the Ministry of Finance.
  • Establishment: In 1982 on the recommendations of B.Sivaraman Committee to implement the National Bank for Agriculture and Rural Development Act 1981.
    • It replaced the Agricultural Credit Department (ACD) and Rural Planning and Credit Cell (RPCC) of Reserve Bank of India, and Agricultural Refinance and Development Corporation (ARDC).
    • The initial corpus of NABARD was Rs.100 crores.
  • Aim & Objectives:Promoting agriculture and rural development through participative financial and non-financial interventions, innovations, technology and institutional development for securing prosperity.
  • Functions: Refinance support for building rural infrastructure.
    • Prepares district level credit plans to guide and motivate the banking industry in achieving these targets.
    • Supervises Cooperative Banks and Regional Rural Banks (RRBs) and helps them develop sound banking practices and integrate them to the CBS (Core Banking Solution) platform.
    • Provides training to handicraft artisans and helps them in developing a marketing platform for selling these articles.

Source: TH

 
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