Finance Minister Nirmala Sitharaman on Friday said the government is monitoring progress of various relief measures, especially the transmission of repo rate cuts to corporates and consumers to stimulate the economy, hit by COVID-19 crisis.
"We are closely monitoring the situation in consultation with banks so that relief measures announced by the Government are effectively percolated at ground levels especially the transmission of repo rate cuts to consumers in terms of reduced interest rates," she said.
Last month, the RBI slashed the benchmark repurchase (repo) rate, the price at which banks borrow from the central bank, by 40 basis points to a historic low of 4 per cent.
"The 1 year median marginal cost of funds-based lending rate (MCLR) declined by 90 bps (February 2019-May 15, 2020). The weighted average lending rate (WALR) on fresh rupee loans has cumulatively declined by 114 bps (basis points) since February 2019, of which 43 bps decline occurred in March 2020 alone," he had said. The Finance Minister said that they are closely watching the developments in disbursement of loans under the provision of Rs 3 lakh crore collateral free automatic loans for businesses to mitigate the daunting impact of COVID-19 on trade and industry.