1.75 million received Rs 76,012 crore loans during festival period

 Banks say efforts now to expand credit to ensure economic revival is durable

Banks have collectively sanctioned loans of Rs 76,012 crore to 1.75 million borrowers during the festival period — from October 16 to November 7 — through the nationwide credit outreach program.

These loans have been distributed in four-five categories, Finance Minister Nirmala Sitharaman said. The government had asked banks to organize an outreach program to lift demand during the festive season.

Banks visited districts and worked with non-banking financial companies to extend loans and their efforts on the ground have helped in reviving the Indian economy, she said.

Sitharaman said the banking sector has turned around remarkably as its non-performing assets have started declining along with higher recoveries. Public sector banks (PSBs) have raised Rs 10,000 crore from the market and are not looking at the government to fund them, she said.

PSBs’ profit in the first half of this financial year is nearly equal to that of the previous full financial year, the Ministry of Finance said.

Sustained recovery efforts have helped PSBs bring down their net NPA to 2.9 percent for the quarter ended September, which has been the lowest in seven years, it said.

“Banks are recording remarkable progress in capital adequacy parameters, leading to increased lending power and engendering confidence in the financial soundness and stability by providing continued assurance to the depositors,” the ministry said in a tweet. PSBs’ capital to risk-weighted asset ratio (CRAR) has risen from 11.7 percent in March 2018 to 14.5 percent in September 2021.