Reserve Bank of India
Date : Apr 07, 2020
RBI permits greater space to State Governments/ Union Territories for availing overdraft facilities
In order to provide greater flexibility to the State Governments to tide over their cashflow mismatches, RBI, on a review, has decided to
a. increase the number of days for which a State/ UT can be in overdraft continuously to 21 working days from the current stipulation of 14 working days.
b. the number of days for which a State/ UT can be in overdraft in a quarter has been increased to 50 working days from the current stipulation of 36 working days.
All other stipulations remain unchanged.
This arrangement will come into force with immediate effect and will remain valid till September 30, 2020.
(Yogesh Dayal)
Chief General Manager
Press Release: 2019-2020/2186
A timely referral by the RBI! Understandably, a lot of errors in management can arise from this – an overwhelming majority would be only due to a poor infrastructure. Given the end of the financial year is approaching pretty soon, the ruling by the Reserve Bank will only ease the blow they would come to face, given the Tax Filing formalities for this year, have only just begun.
~Sanjeev Nanda