India's biggest bank, the State Bank of India (SBI) on Friday announced that all term loan EMIs will be deferred by three months automatically. That means EMIs for all your home loans, car loans, personal loan/term loans get deferred by three months. Announcing the decision, SBI Chairman Rajnish Kumar told CNBC TV, "Installments will get automatically deferred by 3 months for term loans and customers don't have to apply to banks for it." SBI's announcement comes within hours of RBI governor Shaktikanta Das announced a 3-month moratorium on loan EMIs.
The Reserve Bank of India on Friday took a series of measures to minimise the economic impact due to the nationa-wide lockdown caused by Covid 19 which includes moratorium on term loans.
Addressing media, the Reserve Bank of India (RBI) governor Shaktikanta Das today announced that all banks and NBFCs have been permitted to allow a moratorium of 3 months on repayment of term loans outstanding on March 1, 2020.
"All commercial banks (including regional rural banks, small finance banks and local area banks), co-operative banks,all-India Financial Institutions, and NBFCs (including housing finance companies and micro-finance institutions) (“lending institutions”) are being permitted to allow a moratorium of three months on payment of installments in respect of all term loans outstanding as on March 1, 2020," the RBI said.
"The steps to ease working capital pain, reduce liquidity costs and provide a moratorium on term loans will alleviate stress across various sectors and will act as important measures to counter the economic slowdown caused by the pandemic," Surendra Hiranandani, Chairman and Managing Director, House of Hiranandani told India TV.
Moriatorium on loan will give relief to consumers
"The moratorium on housing EMI’s and deferment of interest payments by three months will give a lot of relief to consumers as they can now rearrange their finances. Loans, on the whole, will be cheaper and consumers can save money owing to the measures. Banks will now be persuaded to lend at lower rates of interest and this will put more money in the hands of people and create a higher demand in the overall economy as consumption would go up," Surendra Hiranandani said.ALSO READ | RBI announces massive 75 bps cut in repo rate, reverse repo rate cut by 90 bps in welcome move