In a move to grant relief to borrowers, Supreme Court declared to extend loan moratorium period till September 28, 2020.

Extension of  Loan Moratorium Period

The Supreme Court effectively extended the moratorium on the repayment of loans until 28 September because it continued with the interim order that banks should not declare any loans as NPAs due to the absence of payments during that time.

The previous date was finished on August 31, when the scheme was launched to enable borrowers to overcome the COVID 19 crisis. For the duration of six months, borrowers were entitled to postpone repayment of the loan.

The High Court requested the Government to take the plea not to charge interest on loans during the moratorium, not to reduce credit rating or borrowers asset groups. He also recommended the government to consult the Reserve Bank of India ( RBI) & other lenders and make a concrete decision on the questions that have been addressed. 

The lakhs of the people have lost their income sources, many are in hospitals for their sufferings. The Central Government should state its point perfectly, decide on the moratorium relief, and waive the interest on interest and other issues.

The banking regulator appealed the government to extend a moratorium on the payment of interest rates for a certain time to mitigate the economic blow caused by the pandemic.

By: Shailaja K