BP.BC.47/21.04.048/2019-20 dated 27.03.2020 and extended on 23.05.2020. In case where no interest is being charged on equated monthly instalments for a specified period, for the purpose of relief, interest may be applied at MCLR/ Base rate as the case may be. 2. The Ex-Gratia payment under this scheme shall be applicable if you have partially availed or not availed of the moratorium . 2 crore [aggregate of all facilities with lending institutions] as on 29.2.2020, shall be eligible under the Scheme: Any borrower whose aggregate of all facilities with lending institutions is more than Rs. Such payment does not constitute a contractual, legal or equitable liability of the Central Government and is only an ex-gratia payment to the following designated class of borrowers in view of the COVID-19 pandemic. The details of the Scheme are available at: https://financialservices.gov.in/sites/default/files/Scheme%20Letter.pdf. In respect of Education loans, Housing loans, Automobile loans, Personal loans to professionals and Consumption loans, the rate of interest to be applied for calculating the differential interest component shall be the contracted rate as specified in loan agreements/ documentation applicable as on 29th February 2020. b. For accounts closed during the said period, the period for crediting would be from 1.3.2020 and restricted to the date of closure of such account. As soon as the banks and financial institutions complete the process of crediting the interest on interest waiver, they can claim a reimbursement from the government. Government has issued Additional FAQs COVID 19 Ex Gratia to borrowers for difference in interest Dated 3rd November, 2020. Also Read - UCO Bank Releases SO Admit Card 2020 at … 2 crore [aggregate of all facilities with lending institutions] as on 29.2.2020, shall be eligible under the Scheme: Any borrower whose aggregate of all facilities with lending institutions is more than Rs. As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. The Government of India has announced the Scheme for grant of ex-gratia payment of difference between compound interest and simple interest for six months to borrowers in specified loan accounts (1.3.2020 to 31.8.2020) (the ‘Scheme’) on October 23, 2020, which mandates ex-gratia payment to certain categories of borrowers by way of crediting the difference between simple interest and compound interest for the period between March 1, 2020 to August 31, 2020 by respective lending institutions. All Commercial Banks (including Small Finance Banks, Local Area Banks and Regional Rural Banks), All Primary (Urban) Co-operative Banks/State Co-operative Banks/ District Central Co-operative Banks, All Non-Banking Financial Companies (including Housing Finance Companies). Loans for consumption purposes (e.g., social ceremonies, etc.) Penal interest or penalty for late payment would not be reckoned as part of the contracted rate or WALR. CRISIL in a statement, said the cost to the exchequer would have halved if the waiver was allowed only where moratorium was availed of. (2) As MSME loans are sanctioned by way of Term Loan or CC/OD, the following provisions will apply: The outstanding in the account as at end of 29.2.2020 will be the reference amount for Term Loans on which the interest (simple as well as compound) will be calculated. The period to be reckoned for crediting of difference between compound interest and simple interest … The government had announced on 23.10.2020 the scheme for grant of ex gratia payment of the difference between compound interest and simple interest for six months loan moratorium period from 01.03.2020 to 31.08.2020 to borrowers in specified loan accounts.The lending institutions have been asked to complete the exercise of crediting the amount in the accounts of borrowers by … Govt Giving Cashback To All Credit Card Users! While making the calculation repayments in the loan account during the period to be reckoned will be ignored. While the waiver will offer a modicum of relief in terms of cash flows, repayment discipline among borrowers after the moratorium ended – and thus medium-term delinquencies at banks and NBFCs – will bear watching, it added. Simple interest for the period will be calculated based on daily outstanding as at end of the day at rate of interest prevailing as on 29.02.2020. Yes. NOTE: For card sourced starting 01-11- 2020, Below T&Cs are applicable 1. d. The period reckoned for refund shall be from 1st March 2020 to 31st August 2020, i.e. No. Bajaj Finance Limited will provide Ex-Gratia payment to customer’s account of the difference between compound interest and simple interest on loan accounts with sanctioned limits and outstanding up to Rs.2 crores (aggregate of all the borrowings/ facilities from all the banks and financial Institutions) for the period from 1st March 2020 to 31st August 2020 (6 months / 184 days). 19. 20. Hero Fincorp Ltd. will provide ex gratia payment to the customers account of the difference between compound interest and simple interest on loan accounts with sanctioned limits and outstanding upto Rs. Here are the major questions answered about the grant of ex-gratia payment of the interest of interest, as addressed by the finance ministry: Who is eligible? New Delhi: Earlier this month, all lending institutions were asked to implement provisions of Scheme for grant of ex-gratia payment of the difference between compound and simple interest for six months to borrowers in specified loan accounts (1 March to 31 Aug). 16. Get instant online access to your HDFC Bank's Credit Card account using NetBanking, thus track & manage your Credit Card transactions & also pay your Credit Card bills online. Consumption loans. 2 Cr. 9. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. … No. Settled amount in case of credit card dues is the amount outstanding against the actual transactions. Hence, the banks are expected to credit the refund to eligible borrowers by the end of the day. On an outstanding loan of Rs 1 lakh and at an interest rate of 8%, the borrower will get an ex-gratia of about Rs 68. How will the interest be calculated for cash credit/ overdraft accounts? Will my Non Fund Based Limits as on 29.02.2020 be included for arriving at the eligibility amount of upto Rs.2 crore? At the start of this month, some credit card providers … its circular DOR. When I called the customer care, they didnt have a clue. 1. The lending institutions have been asked to complete the exercise of crediting the amount in the accounts of borrowers by November 5. Agriculture and allied activity loans are not eligible for the interest on interest waiver announced by the government last week, the finance ministry clarified on Thursday. The RBI has notified the Scheme for grant of ex-gratia payment of the difference between compound interest and simple interest for six months ending August 31, 2020. BP.BC.47/21.04.048/2019-20, dated 27th March 2020 and extended on 23rd May 2020. How will the lending institution assess whether a borrower has aggregate loan facilities upto Rs.2.00 cr from the banking system? Business Standard is happy to inform you of the launch of "Business Standard Premium Services". HDFC Bank 1426.70 (+0.76%) HDFC Life 713.75 (+2.57% ... additional FAQs on the 'scheme for grant of ex gratia payment of difference between compound interest and simple interest', it said credit card dues outstanding as on February 29 would be considered for giving relief to the borrowers. ... it said. Lending institutions are to assess this on the basis of information available with them as well as information accessible from credit bureaus. Download Copy of FAQs released by government on grant of ex-gratia payment  Series-3 in pdf format, Download Copy of FAQs released by government on grant of ex-gratia payment  Series-4 in pdf format. The details of the Scheme are available at: Copy of RBI Letter on Scheme for grant of ex-gratia payment in pdf format, FAQ Series-1 on COVID 19 Ex-Gratia to borrowers for difference in interest dated 26.10.2020, Copy of FAQs released by government on grant of ex-gratia payment  Series-1 in pdf format, FAQ Series-2 on COVID 19 Ex-Gratia to borrowers for difference in interest dated 29.10.2020, Copy of FAQs released by government on grant of ex-gratia payment  Series-2 in pdf format, FAQ Series-3 on COVID 19 Ex-Gratia to borrowers for difference in interest dated 03.11.2020, FAQ Series-4 on COVID 19 Ex-Gratia to borrowers for difference in interest dated 04.11.2020. We believe in free, fair and credible journalism. The respective lending institutions as described in clause 3 above shall, after so crediting amounts in the accounts of aforesaid eligible borrowers, claim reimbursement from the Central Government as per provisions hereinafter. The Ex-Gratia Payment Scheme is the payment of the difference between the Compound Interest and the Simple Interest for six months ending 31 August 2021 to borrowers in specified loan accounts. are also eligible for coverage under the scheme, besides other specified categories of loans like consumer durables, automobiles, education, credit card dues, housing and personal loans to professionals. What will be the treatment of penal interest/ penalties while arriving at the rate of interest? What is the ex gratia payment to the borrower under the scheme announced by GoI? 7. The lending institutions have been asked to complete the exercise of crediting the amount in the accounts of borrowers by November 5. Further, for the purpose of claiming of reimbursement by respective lending institutions, calculation of the reimbursable ex-gratia amount shall be as detailed in clauses 8 and 9 hereof. A Non-Banking Financial Company— Micro Finance Institution should be a member of a Self-Regulatory Organisation (SRO) recognised by RBI. In respect of Cash Credit/ Overdraft, the rate of interest for the purpose of calculating the differential shall be the rate of interest prevailing as on 29.02.2020. Whether eligible accounts foreclosed during the period of 1.3.2020 to 31.8.2020 are covered under the scheme? BP.BC.47/21.04.048/2019-20, dated 27.3.2020 and extended on 23.5.2020. 8. Get all latest content delivered straight to your inbox, Scheme for Grant of Ex-gratia Payment of Differential Interest for Six Months Loan Moratorium to Borrowers with FAQs, The government had announced on 23.10.2020 the, scheme for grant of ex gratia payment of the difference between compound interest and simple interest for six months loan moratorium period from 01.03.2020 to 31.08.2020 to borrowers in specified loan accounts. Copyrights © 2021 Business Standard is happy to inform you of the issuers1! 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