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Coimbatore

TEA asks banks to pass on benefits to industry

Covai Post Network

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Coimbatore : With the RBI decision to reduce the repo rate by 25 basis points from 6 per cent to 5.75 per cent, Tirupur Exporters Association (TEA) Thursday appealed to all banks to pass on the reduction of interest rate to the borrowing knitwear garment exporting units, particularly to MSME exporting units which are suffering due to macroeconomic changes.

Hailing the reduction of policy Repo Rate,,TEA President, Raja M Shanmugham said the Monetary Policy Committee decision to change the Monetary policy stance from Neutral to accommodative gives confidence that there would not be any interest hike in the near future.

The monetary policy statement pointed out that transmission of the cumulative reduction of 0.5 per cent in the policy repo rate in February and April 2019 was 0.21 per cent to the Weighted Average lending rate (WALR) on fresh rupee loans. The WALR on outstanding rupee loans increased by 0.04 per cent as the past loans continue to be priced at high rates, he said in a statement.

Considering the industry requirements, Raja Shanugham appealed to all the banks to come forward and pass on the benefit to the borrowing units which will pave way for the growth of investment and exports, he said.

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