Reserve Bank of India asks lending firms to allow 3-month moratorium on EMI payments to offset coronavirus impact

WION Web Team
New Delhi, Delhi, India Updated: Mar 27, 2020, 02:29 PM(IST)

Representative Image of Bank. Photograph:( AFP )

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The liquidity measures announced by the RBI will make available a total Rs 3,74,000 crore to the country's financial system.

A day after Finance Minister Nirmala Sitharman announced a Rs 1.7 lakh crore relief package for the poor of the country, Reserve Bank of India (RBI) Governor Shaktikanta Das on Friday asked all lending institutions to allow a three-month moratorium on EMI payments to infuse liquidity into the system as the economy grapples with COVID-19 challenges.

The RBI Governor in a press conference announced that all non-banking financial companies (NBFCs) and housing finance companies (HFCs) have been permitted to allow a moratorium of 3 months on repayment of term loans outstanding on March 1, 2020.

It has also allowed banks for deferment of interest on working capital loans for the next three months - until June 2020.

"These are extraordinary circumstances, and unprecedented measures are required to support the sagging economy as all the economic activities have come to a halt," Governor Shaktikanta Das said in the press conference.

The liquidity measures announced by the RBI will make available a total Rs 3,74,000 crore to the country's financial system.

 Das said that the deferment on loan and interest repayments will not be classified as defaults and will not impact the credit history of borrowers.

(with inputs from agencies)

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