Banks will focus on cash flow-based lending in future: UCO Bank’s Ajay Vyas


New Delhi: Moving on from scores standards for grant of loans, banks are prone to focus on cash flow-based lending in occasions to come back, a high govt of UCO Bank has stated. “Banks will focus on cash flow primarily based lending in occasions to come back and this has already been began by SBI,” Ajay Vyas, Executive Director, UCO Bank stated at a digital panel dialogue on Redefining Corporate Financing in New Normal organized by PHD Chamber on December 23, 2020.

Various SBI officers have advocated for cash flow-based lending fashions over the standard asset-based or ratings-based ones.

In cash circulate lending, a monetary establishment grants a mortgage that’s backed by the recipient’s previous and future cash flows.

Vyas additional famous that the flip round time (TAT) for grant of loans want to come back down and emphasised that you will need to transfer on from scores standards for grant of loans.

According to Vyas, Artificial Intelligence, algorithms, prediction evaluation are the way forward for lending norms for banks to comply with.

Speaking on banks’ publicity to realty sector by Non-Banking Financial Companies (NBFCs), the DMD, Commercial Credit Group-II (North& South), State Bank of India Thekepat Keshav Kumar stated “it’s improper to say that banks had been lending to NBFCs and not directly to the real estate companies as very much less NBFCs have stakes in the true property sector”.

PHDCCI President Sanjay Aggarwal stated those that deserve and are in dire want of funds must be granted loans whilst checks and balances could also be put on extra stringently.

It is necessary to advertise companies, he stated.





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