SC issues notice to Centre, RBI over plea seeking clarity on loan moratorium

The Supreme Court on Friday issued notices to the Central government and the Reserve Bank of India (RBI) on a plea seeking clarification whether all non-banking finance companies are eligible for loan moratorium or not.

The Supreme Court on Friday issued notices to the Central government and the Reserve Bank of India (RBI) on a plea seeking clarification whether all non-banking finance companies are eligible for loan moratorium or not. The plea, filed by the Confederation of Real Estate Developers' Associations of India (CREDAI), had sought clarification whether all non-banking finance companies are eligible for loan moratorium or whether banks have the discretion to give the benefit.

The RBI had, in March, issued a circular giving liberty to all banks and financial institutions to allow a moratorium of three months on the payment of instalments with respect to all term loans outstanding as on March 1, subject to borrower's request. The decision was taken in a bid to address the financial impact of the lockdown.