India, Feb. 11 -- Department of Financial Services (DFS) secretary Rajiv Kumar has said that the Reserve Bank of India's (RBI) restructuring package for micro, small and medium enterprises (MSMEs) announced last month will help recast Rs 1 lakh crore of loans for 700,000 eligible MSMEs. The estimate from Rajiv Kumar is much higher than domestic rating agency Icra's assessment of Rs 10,000 crore. It comes even as some banks have seen a reluctance among the target MSMEs to take advantage of the scheme.

Kumar said that 700,000 MSME units need restructuring. He also said that they all can be restructured till March 2020 without downgrading the asset. According to him, the scheme will help free up additional resources which will fuel demand an...