Categories: Business

Increase of lockdown will provide loan repayment and relaxation, extension of moratorium on withdrawal of loan and three months.

RBI may extend moratorium on loans by another 3 months

new Delhi. After extending the lockdown period till May 17 in the country, the Reserve Bank is now considering extending the moratorium on banks' loan withdrawal by three months. The central bank has exempted them from paying bank loan installments for three months to help the affected people due to the lockdown imposed to control the corona virus epidemic. This exemption was given till 31 May.

Sources say that now that the government has extended the lockdown period till May 17, it is believed that the period of exemption in payment of loan installments should also be extended. There have been suggestions about extending this period from several areas including the Indian Banks' Association.

Sources say the earnings wheel will not be able to move faster due to the nationwide lockdown being extended till May 17. In such a situation many industries, firms and individuals will not be able to repay their loan installments. The Reserve Bank's three-month grace period ends on May 31. A senior public sector official said that in such a situation, it would be a practical step by the regulator to extend the period of moratorium on the withdrawal of the loan by three months.

The official said that in such a difficult time, such a step would be helpful for both the borrowers and the bank. On March 27, the Reserve Bank had asked banks and financial institutions to offer customers a three-month moratorium on repayment of installments on all types of term loans outstanding on March 1, 2020. Reserve Bank Governor Shaktikanta Das had a meeting with public and private sector banks on Saturday. In this meeting, among other issues, the issue of ban on loan repayment was also reviewed.

This post was published on May 5, 2020 10:24 am

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