End of loan moratorium looms, adds to Covid woes

have no assurance of this being foolproof.

“The lockdown came suddenly and we had to come back home from Kota. Here, at my home in Bihar, it took a long while to get back to our regular routine. A lot of disturbance was also because we didn’t have a teacher to clear our doubts,” said Shiwani Madhesia, who has been preparing for NEET.

Rashika Kumari, a medical aspirant hailing from Siwan in Bihar told this correspondent: “I had to come home due to the pandemic and amidst this, I lost one of my family members. The situation was very gloomy for me. Also, I live in a joint family and there is never a conducive environment to study.” For students whose examination centre is in the vicinity of their locality, it’s a sign of great relief and for the others, this is a cause for major concern.

A petition was filed by Advocate Alakh Alok Srivastava on behalf of 11 students from 11 states on 6 August arguing that the decision to hold JEE through online mode and the NEET through offline mode in centres across India was a sore violation of the fundamental right to life of lakhs of affected students. The petitioner has said: “The Prime Minister has said a vaccine is on the way. Let us wait for that...” The court responded to this on 18 August by pointing out that the question of a vaccine’s likeliness should be left to the experts and the court had no intention of entering that domain.

arranging costs”. “The company where I had been working for the last three years, took just a five-minute call and a 24 hours’ notice to ask me to leave. I had recently bought a new home against a loan and I have no clue how I am going to repay that loan for the next few months since I will have no salary. The moratorium also comes to an end this month.”

Sivesh, a budding lawyer in his early 20s who was working at a law firm in Mumbai, was also asked to leave in July by his employer since his law firm was “restructuring” their work force and had no work during the period of the lockdown.

Sivesh said he has a loan which he was paying in small installments, but with the job gone and the moratorium coming to an end, he is finding it difficult to even sustain himself in a city like Mumbai, leave alone pay installments.

Sivesh told this correspondent, “I was just asked to resign without giving any reason. They just said that the company is cutting down costs. Our salary was already reduced during the period of lockdown since there was hardly any work. But now with no job and having to pay credit card bills and personal loan amounts, I am really worried about how I am going to do it. I desperately need a job. I don’t come from a very wealthy family.”

There are thousands of people like Rahul Das and Sivesh across the country who have lost their jobs during the last few months and there are lakhs of people whose salaries have been cut by their employers owing to the Covid-19 pandemic. According to the CMIE (a private think tank on economic affairs) data released recently, more than 18.9 million people belonging to the salaried class and the organised sector have lost their jobs in the last six months. In July alone, more than 5 million jobs were lost and a CMIE report says, “the plight of salaried employees has worsened since the lockdown has begun”.

The rate of unemployment has also been growing significantly in the organised sector. The CMIE report says that the current unemployment rate in the country stands at around 9%. Apprehending the economic situation across the country, the Government of India and the RBI had announced a moratorium on all loans and credit card payments for a period of three months starting from March, when the pandemic had hit the country. The loan moratorium was further extended for a period of three more months in May this year, and for which the time period is coming to an end on 31 August.

The RBI is unlikely to extend any further deadline for the loan moratorium as banks and other lending institutions have expressed their concern about a cash crunch to the RBI. According to a leading lending agency Finway’s data, more than 46% of the total borrowers had requested for a moratorium on their EMIS and most of these requests had come from the salaried class.

With job losses and salary cuts hitting the salaried class the hardest at this time, what most people who have lost their jobs or have got a salary cut want is a further extension of the period of moratorium as it has become a question of their survival. A senior multinational company employee has had to take a 40% salary cut and has a huge home loan over his head. He told The Sunday Guardian, “I would like to make one request to the government and any decision-making authority to please consider the salary cut and joblessness of the middle-class people. We buy homes with our very hardearned money and we do not want to face the wrath of the banks because of no fault of ours. I have a home loan and two little children; where would I go if I am unable to pay two EMIS? My salary has been cut almost to half, and God knows when the situation will normalise. The government should help us, the honest taxpayers.”

According to sources, the RBI is considering some sort of a relief to be extended to people who have lost their jobs during the pandemic period and were regularly paying their EMIS till 1 March 2020. But the RBI is unlikely to consider any relief for people who have had to take a salary cut during the pandemic period.