Cheap loans for durables by PSU banks

PSU banks will offer cheap loans to consumers to buy two-wheelers, televisions, washing machines, air-conditioners and refrigerators, among others, in an attempt to stimulate demand and boost growth. Ahead of the festival season, the finance ministry on Thursday announced that it will enhance the amount of capital infusion in PSU banks to enable them to lend to borrowers in select sectors, such as two-wheelers and consumer durables, among others, at lower rates. This decision was taken during an hour-long meeting between finance minister P. Chidambaram, RBI governor Raghuram Rajan and economic affairs secretary Arvind Mayaram. Mr Chidambaram said he will meet heads of PSU banks soon to impress upon them the need to lower interest rates.