In what comes as a massive relief for the common man, the RBI has announced a 3-month moratorium on EMIs to be paid across loans
Bengaluru: Less than 24 hours of finance minister Nirmala Sitharaman announcing a financial package of Rs 1.7 lakh crore to help India ease its financial burden, RBI governor Shaktikanta Das announced more good news for the people.
In what can be seen as positive and massive relief for the common man, the RBI has allowed a moratorium on repaying EMIs for the next three months.
The gamut of loans include home, personal, gold and even gold.
This means the loaners will not put any sort of pressure on the loanees to repay the amount, or EMIs, at least for the next three months.
Here is the RBI statement on the issue:
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 and micro-finance institutions) (“lending institutions”) are being permitted to allow a moratorium of three months on payment of instalments in respect of all term loans outstanding as on March 1, 2020. Accordingly, the repayment schedule and all subsequent due dates, as also the tenor for such loans, maybe shifted across the board by three months.
RBI has also slashed rep rates
In what can be termed a 'sizeable reduction' in the policy, repo rate of the country has been slashed it by 75 base points to 4.4%.
On the other hand, the reverse repo rate was slashed by 90 base points to 4%.
It should also be noted that Moody's Investors Service has slashed India's 2020 GDP growth projection from its earlier forecast of 5.3% to 2.5% amid the global Coronavirus pandemic.
Earlier, the Indian government had projected GDP growth at 5% in 2019-20 as compared to 6.1% in 2018-19.
While the nation heaves a collective sigh over deferment of EMIs to be paid, senior Congress leader P Chidambaram has welcomed the slash in repo rates, but not on the EMI aspect.
He said, “I welcome the RBI’s decision to cut the repo rate and measures to provide more liquidity. However, the RBI’s direction on deferment of EMI dates is ambiguous and half-hearted. The demand is that all EMI due dates must be automatically deferred.”
Meanwhile, the RBI governor also asked people not to panic over the Yes Bank crisis and urged them not to resort to panic withdrawals.
He said, "Do not resort to the panic withdrawal of deposits from private banks, your money is safe.”
The RBI governor has emphasised that the Indian banking system was safe and sound and that there was nothing to worry about it.
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Last Updated 27, Mar 2020, 1:06 PM