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More than 80 percent of the non-bank financial institutions (NBFCs) in the country have sufficient liquidity in terms of assets to survive the coronavirus-induced cash squeeze.
Putting to rest the debate over payment obligations during the three-month moratorium allowed by the Reserve Bank of India to borrowers, the report, citing RBI sources, said about 100 top NBFCs, or 4/5th of the total assets of the shadow banking system, had adequate liquidity for loan repayments.
They qualify for funding from banks if they face stress, said the report, citing unnamed sources.
“Some NBFCs are facing issues and no one is saying that the sector doesn’t face problems,” said one of the people cited in the report. “But many of them are okay. Some of them said that were anyway troubled even before the COVID-19 problem surfaced are the ones that may be facing difficulties.”
Moneycontrol could not independently verify the report.
The RBI on March 27 allowed borrowers to put off repayment of term loans by three months, a move designed to alleviate economic pain brought by the viral outbreak.
A Business Standard report earlier suggested that moratorium on term loans could impact NBFCs cash flows and put pressure on asset-liability management (ALM).
Some experts told the daily that ALM could be impacted for up to six months if cash flows were hurt.
Sources told ET that such concerns were unfounded and the Rs 65,000-70,000 crore repayment amount due in June "is quite manageable".