Prime Minister Narendra Modi on Friday praised efforts made by the Reserve Bank of India (RBI) to minimise the impact of the Coronavirus pandemic on the country’s economy.

PM Modi said the RBI has taken “giant steps to safeguard our economy” from the impact of COVID-19. He added that the announcements will improve liquidity, reduce cost of funds, help middle class and businesses.

The apex bank earlier today, after an unscheduled Monetary Policy Committee meet, slashed the repo rate by 75 basis points to 4.4 per cent in a bid to tide over the disastrous impact of the novel Coronavirus on the economy.

Repo rate is the key interest rate at which the RBI lends short-term funds to commercial banks. The cut has been made to encourage banks to give more to business rather than deposit it with RBI.

In another major announcement, the apex bank announced a three-month moratorium on payment of EMIs on all term loans that were outstanding on March 1. The RBI made it clear that this will not affect the credit history of people and neither will it let to asset classification.

All commercial banks including regional rural banks, cooperative banks, NBFCs (including housing finance companies) and lending institutions have been permitted to allow a moratorium of three months on payment of installments in respect of all term loans outstanding as on March 1, RBI Governor Shaktikanta Das said.

Earlier in the day, BJP president JP Nadda also welcomed the “progressive and timely measures” by the top bank.