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Government thrust on infusing liquidity in NBFC sector

Government thrust on infusing liquidity in NBFC sector

By George Alexander Muthoot

Presenting the maiden budget of the Modi 2.0 government, Finance Minister Nirmala Sitharaman has highlighted the government`s thrust on infusing liquidity in the non-banking finance sector (NBFC) sector. In line with our expectations, the Debt Redemption Reserve (DRR) for public issues has been exempted.

 

Also, the credit guarantee provided by the government will further open up the liquidity line for fundamentally sound NBFCs.

We welcome the government`s focus on affordable housing. The interest deduction on home loans raised by Rs 1.5 lakh to Rs 3.5 lakh, and also the housing cost being fixed at Rs 45 Lakh and below. In order to accelerate the goal of 'Housing for All', the tax holiday provided to developers will boost the affordable housing sector.

With the RBI now becoming the regulatory authority for housing finance as well, it will lead to easy regulation as all financing sectors would fall under one authority.

(George Alexander Muthoot is the MD of Muthoot Finance. The views expressed are personal.)

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Government thrust on infusing liquidity in NBFC sector

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