On Friday, at the press briefing post the monetary policy committee’s off-cycle meeting, which has been on for the past three days, Reserve Bank of India (RBI) governor Shaktikanta Das announced that the moratorium on payments of instalments on term loans outstanding from all commercial, regional rural and small finance banks and NBFCs will be extended by 3 more months to 31 August 2020.
The governor listed the 6 announcements made earlier on 27 March and 17 April:
- Granting 3 months moratorium on term loan installments.
- Deferment of interest for 3 months on working capital facilities.
- Easing of working capital financing requirements by reducing margins or reassessment of working capital cycle.
- Exemption of being classified as defaulter in supervisory reporting and reporting to credit information companies.
- Extension of resolution timelines for stressed assets.
- Asset classification standstill by excluding the moratorium period of 3 months.
“In view of the extension of the lockdown and continuing disruptions on account of COVID-19, the above measures are further extended by another 3 months, from 1 June till 31 August, taking the total period of applicability of the measures to 6 months (1 March to 31 August 2020),” Das said.
Lending institutions are permitted to restore the margins on working capital to the original levels by 31 March 2021, the governor said. He also said that measure pertaining to reassessment of working capital cycle are being extended to 31 March 2021.
