<p>Finance Minister Nirmala Sitharaman on Wednesday announced a Rs 30,000 crore special liquidity scheme for non-banking financial institutions to provide credit support to the sector amid the coronavirus crisis.</p>.<p>Further, a Rs 45,000 crore partial credit guarantee scheme 2.0 was also unveiled for non-banking financial companies (NBFCs), housing finance companies (HFCs), and microfinance institutions (MFIs) with low credit rating to help them extend loans to individuals and MSMEs.</p>.<p>Under the Rs 30,000 crore special liquidity scheme, the minister said investments will be made in both primary and secondary market transactions in investment-grade debt papers of these institutions.</p>.<p>These securities will be fully guaranteed by the government.</p>.<p>She said this will provide liquidity support to these institutions and mutual funds and create confidence in the market.</p>.<p>These institutions are finding it difficult to raise money from the debt markets, Sitharaman added.</p>.<p>Talking about the partial credit guarantee scheme 2.0 (PCGS), she said NBFCs, HFCs, and MFIs with low credit rating require liquidity for fresh lending to MSMEs and individuals.</p>.<p>The existing PCGS will be extended to cover borrowings such as primary issuance of bonds/commercial papers (liability side of balance sheet) of such entities.</p>.<p>First 20 per cent of loss will be borne by the guarantor, that is the government. She said that AA-rated papers and below, including unrated papers, will be eligible for investment (especially relevant for many MFIs).</p>.<p>These measures are part of the Rs 20 lakh crore package announced by Prime Minister Narendra Modi on Tuesday.</p>
<p>Finance Minister Nirmala Sitharaman on Wednesday announced a Rs 30,000 crore special liquidity scheme for non-banking financial institutions to provide credit support to the sector amid the coronavirus crisis.</p>.<p>Further, a Rs 45,000 crore partial credit guarantee scheme 2.0 was also unveiled for non-banking financial companies (NBFCs), housing finance companies (HFCs), and microfinance institutions (MFIs) with low credit rating to help them extend loans to individuals and MSMEs.</p>.<p>Under the Rs 30,000 crore special liquidity scheme, the minister said investments will be made in both primary and secondary market transactions in investment-grade debt papers of these institutions.</p>.<p>These securities will be fully guaranteed by the government.</p>.<p>She said this will provide liquidity support to these institutions and mutual funds and create confidence in the market.</p>.<p>These institutions are finding it difficult to raise money from the debt markets, Sitharaman added.</p>.<p>Talking about the partial credit guarantee scheme 2.0 (PCGS), she said NBFCs, HFCs, and MFIs with low credit rating require liquidity for fresh lending to MSMEs and individuals.</p>.<p>The existing PCGS will be extended to cover borrowings such as primary issuance of bonds/commercial papers (liability side of balance sheet) of such entities.</p>.<p>First 20 per cent of loss will be borne by the guarantor, that is the government. She said that AA-rated papers and below, including unrated papers, will be eligible for investment (especially relevant for many MFIs).</p>.<p>These measures are part of the Rs 20 lakh crore package announced by Prime Minister Narendra Modi on Tuesday.</p>