Stressed NBFCs, HFCs Seek 14,000 Cr Liquidity

Stressed NBFCs, HFCs Seek 14,000 Cr Liquidity
27/07/2020 , by , in News/Views

Financing requests of close to Rs 14,000 crore have been received under the Rs 30,000-crore special liquidity scheme for stressed non-banking financial companies and housing finance companies whose financial health deteriorated further due to the Covid-19 crisis, the finance ministry said.

The scheme was launched on July 1. The Reserve Bank of India has provided funds for the scheme by subscribing to government-guaranteed special securities issued by a trust set up by SBI Capital Markets Ltd. The scheme is being implemented by SLS Trust, the special purpose vehicle set up by SBICAP.

As on July 23, five proposals involving an amount of Rs 3,090 crore have already been sanctioned. Further, 35 more applications have been received seeking financing up to Rs 13,776 crore, which are under process.

The scheme permits both primary and secondary market purchases of debt and seeks to address the short term liquidity issues of non-banking financial companies/housing finance companies, it said. The instruments will be commercial papers and non-convertible debentures with a residual maturity of not more than three months and rated as investment grade.

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