Demand for Covid package for banks, NBFCS grows
Lenders are seeking a three-month moratorium on loan repayments and another opportunity for restructuring the debt for borrowers who did not avail of recast under the last year’s regulatory package and are now feeling the heat of the second wave of the pandemic.
Senior bankers said the situation had become serious and it was tough to gauge the economic impact of the pandemic this time around. This is more so for sectors such as hospitality, which got battered in the first wave.
The banks have made a plea to either extend the window for invocation of the regulatory package to June 2021 and allow more time for implementing it, or announce a new window. The invocation date for recast under the Covid package was December and it was to be implemented by June. The relief is being sought especially for the medium and small enterprises, which are under higher stress and have limited capability to withstand shocks. The demand for a regulatory package has been building up for the past month. The Indian Banks’ Association approached the Reserve Bank of India for three relaxations — an extension of working capital assessments, a standstill clause for invocations, and extension by a year of the Commercial Operations Date for those projects whose COD was happening before March 31.
On April 28, the Finance Industry Development Council said those who had availed of the recast earlier should get a second chance.
Senior bankers say the situation had become serious and it was tough to gauge the economic impact