UPSC Articles
NBFCs get ₹50,000-cr. liquidity booster
Part of: GS Prelims and GS-III – Economy
In News:
- The Reserve Bank of India (RBI) has announced a host of measures to provide liquidity support to non-banking financial companies (NBFCs).
- They shall receive ₹50,000 crore worth of liquidity booster.
Key takeaways:
- RBI has also decided to give them certain benefits for loans which are being extended to the commercial real estate sector.
- The RBI has also decided to provide special refinance facility of ₹50,000 crore to NABARD, SIDBI and NHB to enable them to meet sectoral credit needs.
Important value additions:
Reserve Bank of India
- It is India’s central bank, which controls the issue and supply of the Indian rupee.
- RBI is the regulator of entire Banking in India.
- RBI plays an important part in the Development Strategy of the Government of India.
- RBI was set up in 1935 under the Reserve Bank of India Act,1934.
Non-Banking Financial Company
- It is a financial institution that does not have a full banking license or is not supervised by a national or international banking regulatory agency.
- The most important difference between non-banking financial companies and banks is that NBFCs don’t take demand deposits.
National Bank for Agriculture and Rural Development (NABARD)
- It is an Apex Development Financial Institution in India.
- It deals with matters concerning Policy Planning and Operations in the field of credit for Agriculture and other Economic activities in Rural areas in India.
- It is active in developing Financial Inclusion policy.
- It was established on the recommendations of B.Sivaramman Committee, on 12 July 1982.
Small industrial Development Bank of India (SIDBI)
- It is a development financial institution in India.
- It serves as the principal financial institution in the Micro, Small and Medium Enterprises (MSME) sector.
- It was established on April 2, 1990, through an Act of Parliament.
- It is headquartered in Lucknow.
- It operates under the Department of Financial Services, Government of India.
National Housing Bank (NHB)
- It is a Government of India owned entity.
- It was set up on 9 July 1988 under the National Housing Bank Act, 1987.
- It is an apex financial institution for housing.
