The RBI came up with a loan moratorium during this pandemic. Your views.
I think there should be some scope in the system for temporary stopgap measures, especially, if the shock is unprecedented like this pandemic, which no one could have anticipated. The shock in terms of working conditions, the inability of large sectors to generate immediate revenues during lockdown can’t be completely left unaccommodated. The moratorium with a sunset clause is the right approach. The idea is to accommodate the temporary problems, without eliminating the discipline of repaying creditors on time.
We need to prepare the financial system for absorbing losses and ensure there is a wherewithal, both in corporate restructuring as well as in personal delinquencies that may arise.
You have always supported decisive recapitalisation of banks. Why do you think this mitigates the adverse impact of the pandemic?
As we expect some economic activity to revive and rebound with COVID getting controlled, we would want the cost of credit for corporations. Those who have productively aided in the revival, should have low cost of borrowing. The undercapitalised banking system is more interested in maintaining hefty margins to generate a quick return on capital. They are not interested in growing their loan book and competing for loans by offering attractive lending rates. So, if we have an undercapitalised banking system fighting legacy loan problems, coming out of COVID will still not aid in economic recovery. They will act as a headwind to economic recovery. Thus it is crucial to ensure the economy doesn’t have a lasting scar from the pandemic.
Do you think RBI has failed in predicting recent situation where banks and NBFCs went bust? What do you suggest?
هذه القصة مأخوذة من طبعة September 2020 من Outlook Money.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك ? تسجيل الدخول
هذه القصة مأخوذة من طبعة September 2020 من Outlook Money.
ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.
بالفعل مشترك? تسجيل الدخول
Stay Ahead Of AI-Powered Cyber Fraud
AI has become an integral part of our lives, right from customer service at banks to insurance claims. But it has now become a powerful arsenal for the fraudsters too who are increasingly using AI to scam individuals and corporations alike to commit fraud. The key is to stay vigilant
Travelling To Europe? Pack In The Essential Covers
Smart travellers must know that insurance is a must-have. From essential health coverage to theft protection and trip interruptions, know what you need for a worry-free Europe trip
How To Spend Wisely This Year-End
We all spend during the year-end. But the trick is not to overspend or borrow, either from friends, or your own investment, to fund your indulgence. Maintaining balance is the key
Travel Now Pay Later (TNPL)
Travel now, pay later (TNPL) is a close cousin of the more popular buy now, pay later (BNPL) schemes.
12 Books Devina Mehra Loved Reading In 2024
Listing books of her choice, among the ones she reads during the year, is ace investor Devina Mehra's favourite year-end activity. She says it's a daunting task to pick around 12 books from a list of 50.
Here's How To Avail Of Ayushman Bharat Yojana
Launched in 2018, the Ayushman Bharat Yojana aimed to provide health coverage to targeted benefi ciaries from the Socio-Economic Caste Census (SECC) 2011, based on deprivation and occupational criteria.
'Focus On The Business, Assess If You Want To Be A Partner For 10-20 Years'
Professor Sanjay Bakshi, a value investor, behavioural economist and adjunct professor at Flame University, Pune, gives his unique perspective on how to choose a stock, in an interview with Nidhi Sinha, editor, Outlook Money, as part of the Wealth Wizards series. He also shares his learnings from role models Warren Buffett, Charlie Munger, Benjamin Graham and others, and how being a chartered accountant, economist, investor and teacher make him into what he is today. Edited excerpts from the interview
The New Trump Card For IT, Pharma
Donald Trump has been re-elected as the 47th President of the US after a gap of four years. Here's how it will affect the Indian markets and how it will benefit sectors such as IT, pharma, export-oriented sectors and others
European Sojourn
Tight on budget? Dump the popular European destinations for the little-known wonders that are equally attractive
Gold ETFs And FoFs
While Indians love to invest in physical gold, even mutual funds offer the option, but in paper format.
