New Delhi: Amidst the Covid-19 epidemic, the Reserve Bank of India (RBI) has made a big announcement regarding loan restructuring. The Reserve Bank of India (RBI) clarified that only standard loan accounts, which had no default till March 1, 2020, are eligible for restructuring (Loan Restructuring Scheme) under the Epidemic Resolution Draft in August. The RBI in its August 6 circular issued this explanation late Tuesday night to borrowers as well as lenders.
The Reserve Bank of India stated that loan accounts with arrears of more than 30 days as on March 1, 2020 are not eligible for restructuring under the Covid-19 Resolution Framework. This is because the restructuring draft applies only to eligible borrowers, who have been classified as a March 2020 standard. The central bank, however, said such accounts could be resolved under a prudent draft of June 7, 2019.
Similarly, the judge said that project loans relating to deferment of start date of operation (DCCO) have been excluded from the scope of the draft resolution and all such accounts will be administered as per February 7, 2020 and other related directions. In case of lending by the same lender to multiple lenders, all lending institutions have to enter into an inter-credit agreement.
On credit rating it said:
Regarding the need for independent valuation by a credit rating agency on loans of Rs. 100 crore and above, the Reserve Bank of India said that if a rating is taken from more than one agency, then the opinion of all is RP4 rating or above. Should be The explanation also said that the new definition of Micro, Small and Medium Enterprises (MSMEs) effective June 26 would not affect their eligibility for solutions. This solution will be based on the existing definition by March 1, 2020.
SBI had announced:
State Bank of India (SBI) had recently announced loan restructuring to reduce the impact of Covid-19 epidemic on borrowers. As per RBI guidelines, other banks can also come up with their own restructuring plans.
