Finance Ministry Issues Guidelines: Supreme Court directs Center to apply “Interest as soon as possible” on loans up to Rs 2 crore under RBI’s moratorium scheme in view of COVID-19 epidemic that came after Supreme Court’s directive ! In a festive gift to the borrowers, the Finance Ministry on Wednesday approved guidelines for a scheme for prepayment of the difference between compound interest and simple interest for six months of loans up to two crore rupees!
Finance Ministry Issues Guidelines
As per the operational guidelines issued by the Department of Financial Services, the scheme can be availed by borrowers in specified loan accounts for the period from March 1 to August 31, 2020. He said that borrowers who have loan limits! Their limits are approved and the outstanding amount is more than 2 crores! Will be eligible for the scheme on February 29, ”he said!
Housing loans, education loans, credit card dues, auto loans, MSME loans, consumer durable loans and consumption loans are covered under the scheme! According to this scheme, lending institutions will credit the difference between compound interest and simple interest in respect of eligible borrowers in the respective accounts for the said period. Even if the borrower has fully or partially stayed the repayment of the loan announced by RBI on 27 March 2020!
Finance Ministry Issues Guidelines
This scheme applies to those who have not availed the moratorium scheme! And the repayment of loans has continued! After depositing the amount, the lending institutions will claim reimbursement from the central government! According to sources, the government will have to pay Rs 6,500 crore for the implementation of the scheme! On October 14, while hearing the case, the Supreme Court said that it was concerned about this matter! How the benefit of interest forgiveness will be given to the borrowers! And said that the Center has taken a “welcome decision” keeping in mind the plight of the common man! But the authorities have not issued any order in this regard! A bench headed by Justice Ashok Bhushan said, “Something concrete should have been done! Borrowers up to Rs 2 crore to be implemented as soon as possible!
The top court, which posted the case for hearing on 2 November! “Diwali is in your hands”, told the advocates present for the Center and Banks! The Center recently told the top court that the earlier ones were taken! Going Farther Than Fiscal Policy Decisions! Such as discount on compound interest of up to Rs 2 crore for a moratorium period of six months! Can be “harmful” to the overall economic scenario! The national economy and banks cannot take “unavoidable financial constraints”! The top court is hearing a batch of those petitions! Those who have raised issues related to the six month loan moratorium period declared due to COVID-19 epidemic! A bench of Justices RS Reddy and MR Shah also said that when officials have decided something! So it has to be implemented!
