The private lender IDBI bank has offered borrower relief to ease the debt service burden caused by the disruption caused by the coronavirus pandemic. The bank has granted a moratorium on three installments of term loans for three months until May 31, 2020.
The lender sent a communication to its customers proposing a moratorium.
Good news to all of our valued customers! For more information, please read the FAQ regarding the moratorium on three installments of term loans here: https://t.co/EKIeBfHA0y @RBI @DFS_India @EndMinIndia @nsitharaman #IndiaFightsCorona # COVID19 pic.twitter.com/L0qkAhiHqP
– IDBI BANK (@IDBI_Bank) March 28, 2020
The scheme will be applicable to all standard term loans for housing loan, property loan, car loan, education loan and personal loan from March 1, 2020. It aims to ensure the continuity of viable businesses . There may be a temporary disruption in cash flow and, in some cases, loss of income, for businesses and individuals, the scheme will relieve these borrowers.
During the said moratorium period, interest will continue to accrue on the current portion of the term loan.
The accrued interest will be added to the amount of the outstanding loan at the end of the moratorium period and the repayment schedule for these loans will be adjusted accordingly.
The Reserve Bank of India (RBI) has announced a three-month moratorium on all payments, including personal loans and credit card balances, except business loans. Lenders have thought about how the policy can be implemented. Business Standard previously indicated that banks may face operational obstacles in implementing the policy. Branches and call centers working with small staff, communicating with customers and documenting the process are some of the main challenges.