Maharashtra govt to form Non-Banking Financial Services institution

The Maharashtra government has decided to form a non-banking financial services (NBFS) institution to utilise the surplus money with state-run corporations in form of bank deposits.

"The total amount invested by 57 corporations is Rs 40,819 crore in form of bank deposits. Banks give them interest of about 5 to 5.5%. I am of the opinion that it is not the job of government-owned corporations to sit on people's money in such a manner," state Finance Minister Sudhir Mungantiwar said.

The minister said people's money should be utilised for public good and accumulating funds in such a manner is not proper.

"Instead of banks, the corporations can invest the funds with the NBFS Institution and get the interest of their savings. While the government can utilise the money for people's welfare," he added.

"Currently, this amount of Rs 40,819 crore is not being used and the corporations keep getting interest from banks," Mungantiwar said.

"If this amount is transferred to the non-banking financial services institution, the government will not have to pay high interest rates to banks on loans taken for public interest works and the surplus money of corporations will be used to meet urgent needs," he added.

City and Industrial Development Corporation of Maharashtra Limited (CIDCO) has deposits worth Rs 7,146 crore.

Maharashtra Housing and Area Development Authority (MHADA) and Vidarbha Industrial Development Corporation have deposits worth Rs 7,020 crore and Rs 2,757 crore, respectively while the Mumbai Metropolitan Region Development Authority (MMRDA) has deposits worth Rs 16,626 crore.