Finance Industry Development Council (FIDC) has welcomed the RBI move to make available more funds from the banking system for the support of NBFCs that are facing liquidity crunch.
“We welcome the RBI’s move, which will encourage banks to enhance their lending to NBFCs and enable NBFCs tackle the liquidity crunch,” said Raman Aggarwal, Chairman, FIDC, in a statement .
Aggarwal said the whole issue of asset-liability mismatch is more relevant in the case of long-term lending companies like housing finance companies. A typical NBFC model is a retail lending model with short tenures of two to five years, and small ticket sizes where asset-liability mismatch is not a concern.
The RBI move would send the right signal that there is no systemic problem but merely a case of sentiments having gone wrong, he said.
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