As the nationwide lockdown is extended by another 14 days, the apex banking body RBI is mulling over a proposal to further extend moratorium on loans for facilitating borrowers.
Earlier the moratorium was extended on all term loans becoming due for repayment on March 1 for 3 months time until May 31.
Now as the various quarters that includes the IBA has been demanding the extension of moratorium relief on loans, RBI is actively considering it.
So given the fact that income flow shall not continue due to the wake of the coronavirus-led lockdown several borrowers may be unable to service their debt.
It will help both borrowers and banks in these difficult times, the official of a bank said.
"All commercial banks (including regional rural banks, small finance banks and local area banks), co-operative banks, all -India Financial Institutions, and NBFCs (including housing finance companies and micro-finance institutions) ("lending institutions") are being permitted to allow a moratorium of three months on payment of instalments in respect of all term loans outstanding as on March 1, 2020," the RBI had said.
So for them who had opted the moratorium on loan their EMI was not deducted from their account offering the much needed liquidity during such hard times.
On Saturday in a meet with the public and private sector bank, RBI's Das also mulled over the issue.