RBI monetary policy: Cap on e-Rupee to be increased from Rs 10,000 to Rs 1 lakh
- The governor advocated increasing the NACH mandate limit for trade-related settlements from Rs 1 crore to Rs 3 crore
- RBI has also prolonged the on-tap liquidity window for healthcare till June 30th
- The RBI governor forecasts 7.8% economic growth in India for the fiscal year 2023 (FY23)
The Reserve Bank of India (RBI) has increased the cap on e-Rupee prepaid digital vouchers. The current ceiling of 10,000 will be raised to 1 lakh per voucher and can be used several times, governor Shaktikanta Das announced on Thursday.
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Furthermore, in order to provide improved infrastructure for TReDs settlement, the governor advocated increasing the NACH mandate limit for trade-related settlements from Rs 1 crore to Rs 3 crore.
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The Central Bank has also prolonged the on-tap liquidity window for healthcare till June 30th and increased the voluntary retention route cap by 1 lakh crore to 2.5 lakh crore.
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The RBI governor forecasts 7.8% economic growth in India for the fiscal year 2023 (FY23). The current fiscal year’s growth rate remains at 9.2%.
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According to the governor, there has been some loss of economic momentum as a result of the third pandemic wave, and demand for contact-intensive industries has been dampened.
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Furthermore, for the tenth meeting in a row, the Central Bank has held the benchmark interest rate or repo rate – the rate at which banks borrow from the Central Bank – constant at 4% and chose to maintain an accommodating stance.
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In the aftermath of the coronavirus pandemic, the RBI implemented an ultra-loose monetary policy, and in order to provide ample liquidity to the economy, it lowered the key rate to a record low of 4%, which it has maintained since May 2020.
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The six-member Monetary Policy Committee headed by Reserve Bank of India Governor Shaktikanta Das started deliberations on the bi-monthly policy review on Tuesday and made the announcements on Thursday. The meeting of the top bank was originally scheduled to take place between February 7 and February 9 but was deferred by a day after the Maharashtra government declared February 7 a public holiday to mourn the death of legendary singer Lata Mangeshkar.
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