SBI Chairman believes that Union Budget 2022 made important announcements for banking and finance

The Union Cabinet headed by Prime Minister Narendra Modi approved the Union Budget 2022-23 on February 1. State Bank of India (SBI) chairman Dinesh Kumar Khara said that there were significant announcements for the banking and finance sector in this years’ Budget.

The SBI chairman said, “For the banking and finance sector, the announcements are significant. The budget proposes to set up 75 Digital Banking Units (DBUs) in 75 districts of India by Scheduled Commercial Banks.”

Finance minister Nirmala Sitharaman announced the Union Budget for the fiscal year beginning 1 April. While presenting the Union Budget in Lok Sabha, Sitharaman announced that the digital rupee to be issued using blockchain and other technologies will be issued by RBI (Reserve Bank of India) starting 2022-23. Central bank digital currency, digital banking push, amendments to strengthen the bankruptcy law were also introduced in Lok Sabha. Sitharaman said that the Union budget has been made to ensure the development of every sector in the country for the next 25 years.

Dinesh Kumar Khara on the extension of ECLGS

The SBI chairman applauded the Budget. He said that the important announcement of the budget is higher allocation to Capital expenditure and extension of ECLGS (Emergency Credit Line Guarantee Scheme). He said that it is important for the hospitality and related sectors.

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ECLGS will be extended to cover the next fiscal as well, with an expanded guarantee cover of Rupees 5 lakh crore. Under ECLGS, banks provide additional loans to existing borrowers without asking for extra collateral for helping companies sustain the liquidity crunch resulting from the Covid-19 pandemic. The government earlier announced an extension of its ECLGS till March 31, 2022, to support Covid-hit MSMEs (Micro, Small & Medium Enterprises).

The SBI chairman further added that the budget continues to strike a balance between the challenges posed by the Covid-19 pandemic.