DPE asks FinMin to make banks compete for PSUs' deposits
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PSU banks should be made to bid for surplus funds with the state-owned firms, rather than getting them through a common rate of interest, the Department of Public Enterprises (DPE) has said.
In a communication to the Finance Ministry, the DPE has written to the Finance Ministry arguing that these banks must compete among themselves for deposits of the PSU firms, which had a surplus of about Rs 2.50 lakh crore at the end of March, 2010.
At present, the PSUs can choose bank of their choice but the interest rate offered would be the same, as the banks are not allowed to compete, denying the advantage to the PSUs. A minimum of 60 per cent of the investible funds of the PSUs should be parked with the state-owned banks. (PTI)
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