RBI Governor Shaktikanta Das announced liquidity support measures on Wednesday in the wake of an increase in Covid-19 cases in India.

The second wave of COVID-19 in India, according to RBI Governor Shaktikanta Das, has dramatically changed the economic situation. Das went on to say that the RBI will continue to track the situation with all available resources. The inflation curve in India had flattened, but the situation had changed. He also said that the RBI’s quarantine facility is still operational, with over 200 officers working away from their homes. He declared that the second G-SEC purchase under G-SAP 1.0, for Rs 35,000 crore, will take place on May 20, 2021.

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He announced a Rs 50,000 crore on-tap liquidity window with a term of up to three years at repo rate, which will be open until March 31, 2022. The RBI also announced a targeted long-term repo operation of up to Rs 10,000 crore for small finance banks (SFBs). This will be used to provide loans of up to Rs 10 lakh to each borrower. We must reflect on the light during the darkest hours, according to Das. “We should learn from our experience last year when we came together as a country and overcame the once-in-a-generation obstacle presented by the pandemic’s first wave.

A total of Rs 50,000 crore in on-tap liquidity at the repo rate has been opened until March 31, 2022.

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Banks may help organisations such as vaccine manufacturers, medical services, clinics, and patients under the scheme.

Until repayment or maturity, such lending will be classified as a priority market.

Under the system, banks would build a Covid loan book.

At 40 basis points above the reverse repo rate, such banks will park liquidity equal to Covid’s loan book.

E-filing of ITRs increased by 9% in FY20, with 7.38 crore returns submitted by March 31.

The Reserve Bank of India has announced a Rs 10,000 crore targeted long-term repo operation for small finance banks.

The money can be used to lend up to Rs 10 lakh to each borrower.

Smaller microfinance institutions with assets of up to Rs 500 crore are allowed to on-lend to SFBs.

Das said. “Our faith should be like an ever-burning lamp which not only gives us light, but also illuminates the surroundings,” Das concluded.