Moratorium

During the Corona pandemic, the RBI instructed financial institutions to offer a moratorium on all loan types to provide interim relief to borrowers. 

Generally, when a borrower fails to pay his/her credit card bill or loan EMI on time, it’s classified as a default and attracts late payment fees and other penalties. On the other hand, there are no late penalties during the moratorium period. The moratorium period can be thought of as a temporary relief from loan payments. 

Due to the ongoing pandemic, the government had offered temporary relief for loan borrowers. They could opt to stop paying loan EMIs from March till August. The temporary period during which borrowers could stop paying loan EMIs without it being declared as a loan default is known as moratorium.

When it comes to the interest charged on credit card dues, as per the moratorium relief, if you don’t pay your credit card bills within the moratorium period, your bank will levy interest as it normally does and keeps accruing. But they wouldn’t levy late payment fees and the cumulative interest levied can go up to 12%. And if you make further purchases during the moratorium period, the interest on the additional spends will also start accruing and you might end up paying a huge amount on interest.

This EMI moratorium was mainly introduced to benefit people who wouldn’t have a regular cash flow during the covid-19 crisis. This 6 month moratorium would definitely help daily wage workers and salaried individuals who might not be able to make their EMI payments due to pay cuts or layoffs. You can accordingly decide whether you want to take up the EMI holiday or not, according to your financial situation. 

The moratorium is not a waiver but just a postponement of EMI loan payments and also for credit card outstanding dues. The moratorium is for both the principal amount of and the interest. Even though payments are postponed to a later date, the interest will continue to accrue on your dues during the moratorium period. And the interest due will be added to the outstanding amount pending, which will have to be paid along with the principal amount. 

Applying for the EMI moratorium differs from bank to bank. Ever since the RBI has announced the moratorium, banks have made sure that their customers are informed on what is to be done to apply for the moratorium. And all the information on how to avail the moratorium can be checked on each bank's official websites. The most commonly followed way for letting customers opt for the EMI holiday is by sharing links through SMSs or emails.

As there are people facing issues with paying their loan EMIs due to the coronavirus pandemic, the Reserve Bank of India has allowed banks and other financial institutions to provide a 6 month EMI holiday. The EMI holiday is included for all loans including home loan, credit card dues, personal loan, education loan,working capital loans, auto loans, etc. As this is just a postponement of EMI payments, interest will also not be waived off and will continue to be added on the outstanding amount.

The coronavirus pandemic has affected a lot of people financially as the covid-19 crisis has led to a lot of pay cuts and job losses. To ease the financial distress of people during these difficult times, RBI had announced an EMI holiday that was for three months and was extended to six months, until August 31, 2020. Customers who take up the moratorium would not have to pay their EMIs for that particular period of time.

ICICI Bank is allowing its customers to apply for moratorium on your loans, credit cards and other credit facilities. If you apply for the moratorium, your EMI dues will be postponed and you would have to resume payment after August 31,2020. As this is only a deferment of payment, interet will continue to accrue on your outstanding amount,during the moratorium period. Due to this, the tenure of your loan will also get extended.

You can opt to avail the moratorium for your SBI Bank credit card dues. The moratorium means that it’s just a deferment of payment and your credit dues will continue to accumulate interest and other charges(other than Late Payment Charges and residual GST). So it is advised to make card payments regularly, to lessen the burden from accumulation of outstanding amounts. The moratorium has been extended till August 31, 2020.

ICICI Bank provides an exclusive moratorium EMI calculator to measure the impact of opting for the facility announced by the RBI during COVID-19 pandemic. To calculate the impact of moratorium, you need to have the following details. 

During the Corona pandemic, RBI instructed banks to offer a 6-month loan moratorium to all borrowers.  Axis Bank provides a detailed explanation of the Moratorium policy and its impact on your repayment schedule. If you are an Axis Bank customer, you can avail of the moratorium facility online by registering your mobile number. 

State Bank of India (SBI) accepts applications for availing Moratorium facility for up to 6 months starting from March 2020 till August 2020 as per RBI regulations. You can fill up the form and submit it at a nearby SBI branch or you can contact the customer care department to avail this EMI deferment facility. You must remember that opting for moratorium will come with additional cost in the form of interest charges. Henceforth, avail this facility only if deemed necessary. 

During the Corona Pandemic, the RBI announced various measures to ease the burden of EMIs on borrowers. Loan EMI Moratorium was one such step taken to protect borrowers from lenders. 

In view of the COVID-19 pandemic, the RBI has instructed all banks to offer moratorium facilities. If you opt for a moratorium facility on your loan, the repayment period will be postponed. However, interest charges need to be paid during the moratorium period. If you have taken a loan from Bajaj Finserv and have opted for a moratorium, you can use the calculator provided at their website to arrive at the amount you will be paying after the moratorium period. 

The RBI (Reserve Bank of India) had announced that the moratorium would extend till August 31, 2020. The total moratorium period in all eligible term loan accounts will be extended and SBI is also reaching out to its eligible loan customers to obtain their consent to stop their Standing Instructions(SI) to debit loan EMIs every month. The bank has made it easy for customers to stop their EMIs by initiating SMS communication to all eligible customers.

Bajaj Finserv lets you avail moratorium on requesting them to stop EMI repayment of any loans during this period. Interest will continue to accrue on the outstanding amount of the loan during the period of moratorium.

According to RBI guidelines, banks are permitted to offer extension of moratorium on payment of loan installments or credit card dues which fall between the moratorium period. The moratorium period was extended to August 31,2020. Opting for the moratorium means deferment of your EMI payments. The repayment along with the accrued interest will resume from September 2020, once the moratorium period ends. 

HDFC Bank has announced an extension of the moratorium on loans to 31 August, 2020. You can avail loan moratorium up to 6 EMIs due from 1 March, 2020 and 31 August, 2020. If you take up the moratorium you wouldn’t have to pay your EMIs between the moratorium period given.

Taking up the EMI moratorium is not a loan waiver of any kind. It is an EMI holiday where you wouldn’t have to pay your EMIs for a specified period of time.