Rajnish Kumar Don't Think Loan Moratorium Should Be Extended After August

On Friday, SBI's chairman cleared that no blanket extension on loan moratorium beyond August 31, 2020 is required.

Speaking through a video-conference at the 7th SBI Banking and Economics Conclave, Rajnish Kumar said that while it was too early to say if there will be another extension, the Reserve Bank of India (RBI) will have data from all lenders before taking a call.

"But if you ask me, an across-the-board moratorium is not required anymore. However, certain sectors may need some relief and, based on the data available with RBI, there will be a calibrated response," said Kumar.

In the wake of the nationwide lockdown to curb coronavirus spread, RBI allowed moratorium on all retail loans becoming due for repayment in March until May first and then extended it to August. But given the current situation when lockdown is being extended at some of the places such as Pune, you never can say of the pace of economic activity and hence its impact on the borrower.

Also, as per the SBI's moratorium details on its loan book, the chairman cleared that in case one or more installment is paid during the tenure then it shall not be counted as being under moratorium facility.

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