Summary of this article
Bankers say policy rate pause was largely expected this time
RBI regulatory measures on liquidity, MSMEs win approval
Some NBFC voices disappointed over unchanged borrowing costs
Mumbai, Feb 6 (PTI) Bankers said the status quo in policy rates by the Reserve Bank was along expected lines, and welcomed the regulatory and developmental policies announced by Governor Sanjay Malhotra.
State Bank of India's chairman C S Setty, who also chairs the industry lobby grouping Indian Banks Association, said the "status quo on policy rates was widely anticipated".
The proposed reforms including enhanced customer protection and digital payment safeguards to review of lead bank scheme and revamp of the Kisan Credit Card framework will help the system, he added.
State-run Indian Bank's managing director and chief executive Binod Kumar said Malhotra's emphasis on pre-emptive and proactive liquidity management to ensure adequate system liquidity is a positive step and will help sustain credit flows.
"Initiatives to bolster MSMEs, financial inclusion, loan recovery, and digital payments reinforce the ecosystem, while the proposed fraud framework, focus on improving customer centricity and grievance redressal across the banking system, will enhance trust of the customers and service quality," he added.
Indian Overseas Bank's managing director and chief executive, Ajay Kumar Srivastava said the decision to maintain the policy rate while continuing with a neutral stance reflects a balanced approach amid evolving global and domestic conditions.
"We also welcome the RBI's continued emphasis on strengthening the financial ecosystem through customer protection, improved liquidity management, and enhanced credit flow to MSMEs, alongside steps to deepen financial markets," he added.
Among the foreign banks, Standard Chartered Bank's chief executive for India and South Asia, P D Singh, said the emphasis on enhancing financial inclusion through an increase in loan limits to MSMEs, supporting NBFCs, REITs (through Bank funding) and UCBs, further development of the corporate bond market and encouraging foreign flows are all measures that will help add further depth to the market.
In the non-bank finance companies (NBFC) space, Tata Capital's MD and CEO Rajiv Sabharwal welcomed the policy stability and targeted regulatory measures, saying it will provide a supportive environment for NBFCs to sustain credit momentum and contribute to inclusive economic growth.
The supply chain finance-focused CapitalXB's executive director Ajitabh Bharti was, however, not enthused by the RBI decision.
"We are disappointed RBI held the repo rate steady despite inflation hitting multi-year lows. This conservative stance ignores the real pain point: high borrowing costs choking Indian entrepreneurs and micro, small and medium enterprises (MSMEs)," Bharti said.
