Moratorium on home, vehicle and personal loans, not on credit card payments

The moratoriums applies to all term loans like home loans, vehicle loans and personal loans. However, credit card payments are not covered under the moratorium period. People have to continue paying them. There is no deferment here.

By Author  |  Published: 27th Mar 2020  5:21 pmUpdated: 27th Mar 2020  8:18 pm

Hyderabad: The Reserve Bank of India has announced a slew of measures to improve the liquidity position even as there is a lockdown. It has announced to cut down the loan rates. This will lower the EMIs or tenures of various loans. The other big announcement is the moratorium on EMIs of term loans, explains Sai Krishna Pathri, certified financial planner, MoneyPurse.

What loan rates are cut?

RBI has reduced the loan rates on home, car, education or personal loans. As a result, EMIs will come down or the tenure will reduce for the loans, correspondingly.

What else is being offered?

RBI has allowed three months loan EMI moratorium for term loans. All those having home, car, education or any other term loan will benefit from this including those having consumer durable loans. It is not a waiver. Those who cannot pay the EMIs will get three months more time. With moratorium, there will be no penalties for not paying for the allowed period and also the credit scores will not be impacted. It is not a waiver of loans.

What does the moratorium cover?

All term loans are covered. EMIs/dues of credit card payments are also covered.

How does one avail the EMI extension?

One needs to request his/her bank for availing the moratorium benefit offered by the RBI, showing how their income is affected due to Covid-19 lockdown. Those employees who anticipate a delay in receiving salaries from their employers due to the lockdown or those in business whose operations are affected and are not in a position to pay the EMIs can take the benefit of the moratorium, by sharing acceptable evidence with the respective banks.

Will all banks pass on the benefit?

No, it is not mandatory. However, since it is instructed by RBI, all banks are likely to follow it.


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