The Union government has informed the Supreme Court that lenders have been directed to credit in the accounts of eligible borrowers by 5 Novemberthe difference between compound interest and simple interest collected on loans of up to Rs 2 crore during the RBI’s loan moratorium scheme.
The Finance Ministry has said that after crediting this amount, the lending institutions would claim reimbursement from the Central government.
The government, in an affidavit filed in the Supreme Court, has said that the Ministry of Finance has issued a scheme as per which lending institutions would credit this amount in the accounts of borrowers for the six-month loan moratorium period which was announced following the Covid-19 pandemic situation.
As per the scheme, all lending institutions (as defined under clause 3 of the scheme) shall credit the difference between compound interest and simple interest in the respective accounts of eligible borrowers for the period between 1 March 2020 to 31 August 2020, the affidavit stated.
It further said the Centre has directed that all lending institutions described in clause 3 thereof shall give effect to the scheme and credit the amount calculated as per the scheme in the respective accounts of borrowers by 5 November, 2020.
The affidavit added the amount shall be credited by lending institutions irrespective of whether such eligible borrowers have fully availed or partially availed or have not availed of the moratorium viz. deferment in payment of instalments as per the circulars dated 27 March 2020 and 23 May 2020 issued by Reserve Bank of India. With festivals around, such moves would help revive economy.