The public’s money is “extremely safe” in public sector banks and the government is 100% committed to these banks, Finance Minister Piyush Goyal said on Tuesday.

“Public money is extremely safe in public sector banks,” Mr. Goyal said at a press conference following a meeting with the heads of public sector banks. “The government stands behind public sector banks 100%, and their money is extremely safe. Government-owned banks’ deposits are 100% safe and secure.”

The Finance Minister also said that the government was open to the idea of providing the Reserve Bank of India with more powers to effectively regulate and manage public sector banks. His statement follows RBI Governor Urjit Patel’s statements to the Standing Committee on Finance that the central bank needed more powers, such as the ability to appoint and dismiss the heads of PSBs.

“The government stands 100% committed to support each and every one of our public sector banks and to ensure the viability and successful future of every PSU bank, particularly because they are the engines which take financial inclusion to the last man at the bottom of the pyramid,” Mr Goyal added. “I don’t think that PSBs have got into losses or got into trouble now. This was already existing, it’s only that we have shown the mirror to the world and actually brought it down the table.”

Following the meeting with the bankers, Mr Goyal said the PSBs had come up with a plan to take up the credit needs of “genuine, deserving, well performing and good companies”. In the first stage, they will assess the needs of companies who have borrowings between Rs 200 crore and Rs 2,000 crore. In the second stage, they will take up the accounts with borrowings of up to Rs 200 crore, which he said would also cover MSMEs.

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