RBI shouldn’t forget its role as lender of last resort: SBI Economists

The RBI has been reminded by the economists at the State Bank of India (SBI) that they should not forget their role as the lender of last resort.

The economists at SBI has asked the central bank to play its role as the lender of last resort keeping the NBFC’s continuous state in distress in mind, which the RBI has avoided since the beginning of troubles in 2018.
The economist in its report on Budget expectations said that the RBI should “seriously think” of providing liquidity to NBFCs against the assets held by the lenders.

“Given the crisis of confidence in the financial markets, it is imperative that the the central bank doesn’t forget their primary function of being the lender of the last resort,” they said.