Temporary prohibition on loan instalments, postponement of interest payments and restructuring initiatives taken by RBI during Covid-19 pandemic have prevented a big spike in NPAs till now.
Bank credit growth has slowed significantly in 2020 despite the RBI’s efforts to infuse liquidity into the banking system.
Frauds reported by banks of Rs.1,00,000 and above value have more than doubled (28% increase) in FY 2019-20.
The public sector banks accounted for most of these frauds (80%).
The rural demand fared better than urban areas due to the increased pace of kharif sowing.
In Hospitality, hotels and restaurants, airlines and tourism sectors, employment losses are more severe than in other areas.
Inflation may remain high in the second quarter of 2020-21.
Currency notes of ₹2,000 denomination were not printed in 2019-20 and the circulation of these notes have declined over the year.
Compared to the previous year, there was an increase in counterfeit notes detected in the denominations of ₹10, ₹50, ₹200 and ₹500.
Counterfeit notes detected in the denominations of ₹20, ₹100 and ₹ 2,000 declined.
Suggestions Made by RBI:
Targeted public investment along with asset monetisation and privatisation of major ports.
Apex authorities to drive structural reforms and speedier implementation of infra projects.
Recapitalisation of public sector banks,.
Deep-seated and wide-ranging reforms to regain losses.
