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Rescheduling of Payments - Term Loans and Working Capital Facilities RBI Instructions

Rescheduling of Payments - Term Loans and Working Capital Facilities.

      In respect  of  all  term  loans  (including  agricultural  term  loans,  retail  and  crop loans), 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)  (“lending  institutions”)   are permitted to grant  a moratorium  of  three months  on  payment  of  all  instalments falling  due  between March 1,  2020  and  May  31,  2020.  The  repayment  schedule  for  such loans  as  also the residual tenor,  will  be shifted  across  the  board by  three  months  after  the  moratorium  period. Interest  shall  continue  to accrue on  the outstanding  portion  of  the term  loans  during the moratorium  period.  

          In  respect  of  working  capital  facilities  sanctioned in the  form  of  cash credit/overdraft (“CC/OD”),  lending  institutions  are  permitted  to  defer  the  recovery  of  interest  applied in respect  of  all  such  facilities  during  the period from  March  1,  2020  upto  May  31,  2020 (“deferment”).  The  accumulated  accrued  interest  shall  be  recovered  immediately  after the completion of  this  period.