Mumbai, Sep 11 (PTI) The government on Wednesday asked banks to put in all efforts to resolve bad loans themselves and approach National Company Law Tribunal (NCLT) only in the absence of any alternative.

Minister of State for Finance and Corporate Affairs Anurag Thakur said NCLT route should not be used by bankers to resolving stressed accounts on a daily basis.

"I would request bankers to try and resolve stressed assets in the right earnest and refer cases to NCLT only if satisfied resolution outside the NCLT process is not available," Thakur said at the 72nd annual general meeting of Indian Banks' Association (IBA).

He assured bankers to take decision to lend to the industry without any fear of 'witch-hunting' in future by any investigative agencies.

"I want to assure you (bankers) that the decisions taken by you in course of business in good faith with a sound business rationale will not face any witch-hunt," the junior minister said.

Bankers should timely report frauds without any fear of repercussions, he said.

Thakur said despite a 110 basis points repo rate reduction by the Reserve Bank of India over the last few months, banks have not passed on the full benefit to the consumers.

"Only a fraction of the rate cuts benefits were passed-on by the banks to borrowers. I appeal to banks to further pass on the benefits of the rate cuts to companies which will lead to an increase in the consumption cycle, thereby, leading to a revival in their investments," he said.

In the last five years, the government has recapitalised public sector banks (PSBs) by over Rs 2 trillion, and recently also announced an immediate capital infusion of Rs 70,000 crore in these lenders.

Thakur said the banks are being encourage to lend more to NBFCs, which will improve the availability of credit in the market and reduce the liquidity crunch.

"I am positive that the steps taken by the RBI mandating the banks to link their fresh retail loans issued from October 1 to an external benchmark will lead to cheaper funds for the borrowers," he said, adding that it will also reduce the cost of working capital loans for the industry.

He also requested IBA to look into the transfer and human resource policies at banks, especially for women employees.

"If you are going away thousands of kilometer away from your home, and if you are not mentally there then ultimately it is going to impact customers," Thakur said. PTI

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