RBI extends fresh support of ₹50,000 cr. to NABARD:

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RBI extends fresh support of ₹50,000 cr. to NABARD:

Context:

To help mitigate the impact of the pandemic and aid economic revival, the RBI said it would extend fresh support of ₹50,000 crore to the All India Financial Institutions for new lending in FY22.

 Details:

  • Accordingly, NABARD will be provided a special liquidity facility (SLF) of ₹25,000 crore for one year to support agriculture and allied activities, the rural non-farm sector and non-banking financial companies-micro finance institutions.
  • An SLF of ₹10,000 crore will be extended to the National Housing Bank for one year to support the housing sector.
  • SIDBI will be provided ₹15,000 crore under this facility for up to one year for funding of micro, small and medium enterprises (MSMEs).

About NABARD:

  • It is an apex development and specialized bank established on 12 July 1982 by an act by the parliament of India.
  • Its main focus is to uplift rural India by increasing the credit flow for elevation of agriculture & rural non farm sector.
  • It was established based on the recommendations of the Committee set up by the Reserve Bank of India (RBI) under the chairmanship of Shri B. shivaraman.
  • It replaced the Agricultural Credit Department (ACD) and Rural Planning and Credit Cell (RPCC) of Reserve Bank of India, and Agricultural Refinance and Development Corporation (ARDC).
  • It has been accredited with “matters concerning policy, planning and operations in the field of credit for agriculture and other economic activities in rural areas in India”.


Important functions:

  1. It provides refinance support for building rural infrastructure.
  2. It prepares district level credit plans to guiding and motivating the banking industry in achieving these targets.
  3. It supervises Cooperative Banks and Regional Rural Banks (RRBs) and helping them develop sound banking practices and integrate them to the CBS (Core Banking Solution) platform.
  4. It provides training to handicraft artisans and helps them in developing a marketing platform for selling these articles

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