India: Supreme Court to resume hearing on loan moratorium case

  • The apex court will resume hearing a batch of petitions urging an extension of the loan moratorium period and waiver of interest on interest on term loans on 19 Nov 20.
  • The RBI had given a loan moratorium owing to Covid-19 and its fallout on businesses and consumers’ income. The period of moratorium had ended on 31 Aug 20.
  • Subsequently, borrowers had sought relief from the top court asking for waiver of interest on interest and a further extension of the moratorium period.
  • The finance ministry in its affidavit filed before the top court on 25 Oct 20 had stated that the government has decided to provide a waiver on compounding of interest for the moratorium period for loans to MSMEs and personal loans up to INR20mn.
  • The RBI had directed banks to credit the requisite amount to borrowers’ accounts.

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