Finance Minister Nirmala Sitharaman has asked banks and NBFCs to roll out loan restructuring scheme for COVID-19 related stress by September 15, and provide adequate support to the borrowers following the lifting of moratorium on repayment of debts. The minister according to a news agency report has urged the lenders to immediately put in place a board-approved policy for resolution at the review meeting with heads of scheduled commercial banks and NBFCs through video conferencing.
During the meeting, the minister impressed upon the lenders that as and when the moratorium on loan repayments is lifted, borrowers must be given support and COVID-19 related distress must not impact the lenders’ assessment of their creditworthiness, an official statement said. The six months moratorium on payment of EMIs ended on August 31.
During the three-hour meeting, the statement said, the Finance Minister asked lenders to identify eligible borrowers and reaching out to them, and the quick implementation of a sustained resolution plan by lenders for the revival of every viable business. Banks are in the process of getting a board-approved restructuring framework in line with the RBI’s framework and eligibility defined by the central bank in its notification on August 6.
The Finance Minister also emphasised that resolution schemes must be rolled out by lenders by September 15, 2020, and a sustained media campaign to create awareness be carried out thereafter, the statement said. She advised lenders to ensure that regularly updated FAQs on the resolution framework are uploaded on their websites in Hindi, English and regional languages, and also circulated to their offices and branches, it added.