Chidambaram welcomes RBI's special liquidity facility

Chidambaram welcomes RBI's special liquidity facility for mutual funds

Former union finance minister P Chidambaram

Former Finance Minister P Chidambaram on Monday lauded the RBI's prompt action in announcing a Rs 50,000 crore special liquidity facility for mutual funds.

Read: RBI announces special liquidity facility of Rs 50,000 crore for mutual funds amid coronavirus, Franklin Templeton crisis

The Reserve Bank of India on Monday announced a Rs 50,000 crore special liquidity facility for mutual funds, days after Franklin Templeton Mutual Fund decided to close six debt schemes.

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"I welcome the RBI's announcement of a Rs 50,000 crore special liquidity facility for Mutual Funds. I am glad that RBI has taken note of the concerns expressed two days ago and requesting prompt action," the Congress leader said on Twitter.

Chidambaram had on Saturday expressed "grave concern" for investors over Franklin Templeton Mutual Fund's decision to wind up six debt schemes and urged the government to act promptly to resolve the issue.

Also Read: Franklin Templeton locks up Rs 26,000 crore across 6 schemes

Franklin Templeton Mutual Fund voluntarily decided to wind up its six debt schemes citing redemption pressure and lack of liquidity in bond markets due to the coronavirus pandemic.