RBI not in favour of providing special credit window to NBFC sector

Ever since the IL&FS crisis erupted, banks have been averse to lending to the sector, which has put them in a tight spot

The Reserve Bank of India is not in favour of providing special credit window to the NBFC sector to tide over the liquidity crunch as the cash crunch phenomenon is not systemic, said sources.

Industry players and government think-tank NITI Aayog made a case for giving special credit window for non-banking financial companies (NBFCs) facing liquidity crunch following default by group of companies of IL&FS since September 2018.

Many NBFCs, including DHFL and Indiabulls Finance, came under severe liquidity pressure compelling them to bring down their reliance on commercial papers.

Ever since the IL&FS crisis erupted, banks have been averse to lending to