Team Blitz India
NEW DELHI: Finance Minister Nirmala Sitharaman said that scheduled commercial banks should focus on core banking rather than high-risk long-term project financing. In an interview toBusinessline,the FM clarified that she was not commenting on a specific policy but on the general principle that banks should focus on their core banking functions.
Sitharaman felt there were dedicated institutions for long term financing. “National Bank for Financing Infrastructure and Development (NaBFID) was brought on board for long-term financing and that too with deep pockets. We were very clear that public sector banks or scheduled commercial banks should not lend for long term from the money borrowed for short term and get into asset-liability mismatch situation,” she said.
According to the FM, NaBFID is working well. “We are strongly of the view that we should take that route for funding infrastructure. It is not just funding infrastructure but also enabling development finance,” she added.
