According to the budget the amount of Rs 11,200 crore was decided as equity to be provided to the banks. But it is reported that banks may get more than this next year. On the basis of the loans schemes for consumer products and automobiles the banks offer to their customers, banks are suppose to finalize the demand of financial support they will need.
Government will chip in with 10% of the loan disbursal as its share of equity. PNB bank has finalized the a bill with finance ministry however other banks are yet to go. The banks will first meet IBA and will put up their demands.
A senior official reported that the government has allocated Rs 14,ooo crore and the amount may go up if the bank demands more, but Government is much alert and have asked the lenders first recover loans that have already been written off. The official stated that from past few months government is more focusing on banks to recover the loans that will help them to enhance the banking, if needed the finance ministry will providing support to the banks.