Centre, RBI gets a week to file affidavits in Loan moratorium case
Published On: Monday, October 5, 2020 | By: Team KnowMyStock
The Supreme Court today(5th Oct.2020) adjourned the hearing in the loan moratorium case to October 13. The bench granted an additional week's time to the government to file the affidavit recounting the guidelines, notifications, and circulars that have been taken by the RBI and Union government. The development comes as the Centre is set to formulate a scheme to waive compound interest for small borrowers during the six-month moratorium period, which may come at a cost of Rs 5,000-7,000 crore. The government, during the hearing, submitted a Cabinet note to the apex court following its approval.
The scheme on the compound interest waiver will spell out the manner in which the government will transfer money to banks after they submit claims of the entitled borrowers. It may also delve upon the manner in which a notional value of compound interest will be calculated by banks for those borrowers who have been regularly repaying their loans during the moratorium period. “We will put a time window for banks to avail of the monetary benefits from the government,” a Finance Ministry official told Business Standard.
The government's decision will benefit those clearing their dues on a variety of loans between March and August.
Tags: loan moratorium case
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