NEW DELHI: The Reserve Bank of India (RBI) on Friday took several steps to help both large and small non-banking finance companies (NBFCs) gain access to cheaper credit and facilitate higher lending from them.
The steps will particularly be useful to lower rated NBFCs which have found it very tough in the current covid-19-affected environment to raise money and lend further.
The central bank will conduct targeted long-term repo operations (TLTRO 2.0) for an aggregate amount of ₹50,000 in tranches.
The funds availed by banks under TLTRO 2.0 should be invested in investment grade bonds, commercial paper (CP) and non-convertible debentures (NCDs) of NBFCs, with at least 50% of the total amount availed going to small and mid-sized NBFCs and