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Which of the following is/are correct with reference to the Special Liquidity Scheme for Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs), recently launched by the government?
1. RBI will provide funds for the Scheme by subscribing to government- guaranteed special securities.
2. All NBFCs registered as Core Investment Companies are eligible to raise funds under the scheme.
3. The financing can be used by the NFBCs/HFCs only to repay existing liabilities and not to expand assets.
Select the correct answer using the code given below.
  • a)
    1 only
  • b)
    2 and 3 only
  • c)
    1 and 3 only
  • d)
    1, 2 and 3
Correct answer is option 'C'. Can you explain this answer?
Verified Answer
Which of the following is/are correct with reference to the Special Li...
  • With a view to improving the liquidity position of Non-Banking Financial Companies (NBFCs) as well as Housing Finance Companies (HFCs), the government launched a Special Liquidity Scheme of Rs. 30,000 crore. The Scheme was launched on July 1, 2020, through a Special Purpose Vehicle in the form of SLS Trust set up by SBI Capital Markets Limited (SBICAP).
  • RBI will provide funds for the Scheme by subscribing to government-guaranteed special securities issued by the Trust. The total amount of such securities issued outstanding shall not exceed Rs. 30,000 crores at any point in time. The government of India will provide an unconditional and irrevocable guarantee to the special securities issued by the Trust. Hence, statement 1 is correct.
  • Statement 2 is not correct: Any NBFC including Microfinance Institutions registered with RBI under the Reserve Bank of India Act, 1934 (excluding those registered as Core Investment Companies) and any HFC registered with the National Housing Bank (NHB) under the National Housing Bank Act, 1987 which is complying with the following broad conditions will be eligible to raise funding from the said facility:
    (i) Compliance with RBI regulations on Capital adequacy
    (ii) Net NPA is less than 6% as on 31.03.2019
    (iii) Net profit in at least one of the two preceding financial years
    (iv) Rated as investment grade by a rating agency
    (v) Is not reported under SMA-1 or SMA-2 category by any bank for their borrowing during the period one year prior to 01.08.2018
  • The Scheme will remain open for 3 months for making subscriptions by the Trust. The period of lending (CPs/NCDs of NBFCs/HFCs for short duration of upto 90 days) by the Trust shall be for a period of up to 90 days. The financing would be used by the NFBCs/HFCs only to repay existing liabilities and not to expand assets. Hence, statement 3 is correct.
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Which of the following is/are correct with reference to the Special Liquidity Scheme for Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs), recently launched by the government?1. RBI will provide funds for the Scheme by subscribing to government- guaranteed special securities.2. All NBFCs registered as Core Investment Companies are eligible to raise funds under the scheme.3. The financing can be used by the NFBCs/HFCs only to repay existing liabilities and not to expand assets.Select the correct answer using the code given below.a)1 onlyb)2 and 3 onlyc)1 and 3 onlyd)1, 2 and 3Correct answer is option 'C'. Can you explain this answer?
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Which of the following is/are correct with reference to the Special Liquidity Scheme for Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs), recently launched by the government?1. RBI will provide funds for the Scheme by subscribing to government- guaranteed special securities.2. All NBFCs registered as Core Investment Companies are eligible to raise funds under the scheme.3. The financing can be used by the NFBCs/HFCs only to repay existing liabilities and not to expand assets.Select the correct answer using the code given below.a)1 onlyb)2 and 3 onlyc)1 and 3 onlyd)1, 2 and 3Correct answer is option 'C'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Which of the following is/are correct with reference to the Special Liquidity Scheme for Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs), recently launched by the government?1. RBI will provide funds for the Scheme by subscribing to government- guaranteed special securities.2. All NBFCs registered as Core Investment Companies are eligible to raise funds under the scheme.3. The financing can be used by the NFBCs/HFCs only to repay existing liabilities and not to expand assets.Select the correct answer using the code given below.a)1 onlyb)2 and 3 onlyc)1 and 3 onlyd)1, 2 and 3Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which of the following is/are correct with reference to the Special Liquidity Scheme for Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs), recently launched by the government?1. RBI will provide funds for the Scheme by subscribing to government- guaranteed special securities.2. All NBFCs registered as Core Investment Companies are eligible to raise funds under the scheme.3. The financing can be used by the NFBCs/HFCs only to repay existing liabilities and not to expand assets.Select the correct answer using the code given below.a)1 onlyb)2 and 3 onlyc)1 and 3 onlyd)1, 2 and 3Correct answer is option 'C'. Can you explain this answer?.
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