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Supreme Court notices to Centre, RBI on plea by real estate body on loan moratorium

Supreme Court issues notice to Centre, RBI on plea by real estate body on loan moratorium

The Supreme Court on Friday issued notices to the Centre and the Reserve Bank of India (RBI) on a petition on the issue of loan moratorium.

In its petition, the Confederation of Real Estate Developers’ Associations of India (CREDAI) sought to know if all non-banking finance companies are eligible for loan moratorium or whether banks have the discretion to give benefit.

The petition was filed on May 12.

In its notices, the Supreme Cout has sought responses from the Centre and the RBI in two weeks.

The RBI had on March 27 allowed banks and financial institutions to offer a moratorium of three months on payment of instalments of all term loans outstanding as on March 1 to help mitigate hardship faced by borrowers during the coronavirus pandemic.

Accordingly, it had said, the repayment schedule and all subsequent due dates, as also the tenor for such loans, may be shifted across the board by three months.

As a result of this moratorium, individuals’ EMI repayments of loans taken were not deducted from their bank accounts, providing much needed liquidity.

The loan EMI payments will restart only once the moratorium time period of 3 months expires.

source: hindustantimes