No loan moratorium right now, RBI Governor

Apr 08 2021 07:44 AM
No loan moratorium right now, RBI Governor

The Reserve bank of India (RBI) on Thursday said it will provide a debt resolution window to enable lenders to implement a resolution plan in respect of eligible corporate exposures as well as personal loans, keeping the ownership unchanged, and without classifying them as non-performing loans.

The RBI Governor Shaktikanta Das also said there is no need for a loan repayments moratorium at present, stating that businesses are better prepared to face the situation. It can be noted that the RBI had announced a six-month moratorium in the early days of the national lockdown last year to help borrowers impacted by a chilling in economic activity.

The entire state of Maharashtra is in a lockdown for non-essential services and localised and night lockdowns are being observed in many pockets of the country, including the national capital, to restrict the surge in cases. "In today's conditions, there is no need for a moratorium," Das said during an interaction with journalists after the announcement of the new fiscal year's first monetary policy review. He said businesses, particularly the private sector ones, are better prepared today to deal with the situation and to continue with their activities.

Terming loan moratoriums as a "conventional" instrument, which is akin to a standard operating tool, Das reminded that the RBI has taken a slew of innovative measures over the last year to help the economy in the pandemic.

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