PSU banks are lending less to MSMEs and Agri sector but their retail and housing loan portfolio growing said Reserve Bank Governor Raghuram Rajan at the inauguration of ASSOCHAM Karnataka chapter.Private sector banks are lending more to MSMEs and Agri sector in the recent times.The slowdown in credit growth has been largely because of stress in the books of public sector banks."It is not the level of interest rates that is the problem, instead, the loans already in public sector banks' balance sheets are stressed, and therefore their unwillingness to lend more to those sectors to which they have high exposure," Rajan said.
Answering a question on banks unwillingness for lending to startups he said "It is a real issue everywhere. Banks may not lend to startups working on may not lend to startups working on software or a cloud platform and will likely tell the entrepreneur to approach venture capitalists and investors who can understand the sector better,banks always look for hard assets as collateral," said Raghuram Rajan.
PSU banks are lending less to MSMEs & Agri Sec.but their retail & housing loan portfolio growing says #RaghuramRajan pic.twitter.com/kGtnn2CCAv— Press Release Watch (@PrReleaseWatch) June 23, 2016
Answering a question on banks unwillingness for lending to startups he said "It is a real issue everywhere. Banks may not lend to startups working on may not lend to startups working on software or a cloud platform and will likely tell the entrepreneur to approach venture capitalists and investors who can understand the sector better,banks always look for hard assets as collateral," said Raghuram Rajan.
