India plans to ask state-run banks to expand lending to boost demand

  • MUMBAIMUMBAI -India is planning to ask state-run banks to reach out to every district to expand lending to boost demand in the economy, the finance minister said, a move that comes at a time when most lenders are already seeing an increase in bad loans.
  • Domestic banks have struggled to contain bad loans, especially in their retail portfolios, as the pandemic and resultant lockdowns hit economic activity and limited borrowers’ ability to repay debt.
  • India’s largest lender State Bank of India posted a four-fold jump in slippages, or new bad loans, for the first quarter, ending in June, as its home loan and small business segments struggled.
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