SCHEME FOR GRANT OF EX-GRATIA PAYMENT OF DIFFERENCE BETWEEN COMPOUND INTEREST AND SIMPLE INTEREST FOR SIX MONTHS TO BORROWERS IN SPECIFIED LOAN ACCOUNTS

About:

• By granting ex-gratia payment of difference between compound interest and simple interest during the six month moratorium period to distressed/vulnerable category of borrowers, irrespective of whether the borrower had availed of moratorium or not, the scheme would equitably help small borrowers bear the stress on account of the pandemic.
  
  
• Background: In the context of the COVID-19 pandemic, “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)” was approved by the Cabinet in October, 2020, envisaging therein an outlay of Rs. 5,500 crore.
  
  
• Following category of borrowers were eligible for ex-gratia payment under the scheme:
  • MSME loans up to Rs. 2 crore
    
    
  • Education loans up to Rs. 2 crore
    
    
  • Housing loans up to Rs. 2 crore
    
    
  • Consumer durable loans up to Rs. 2 crore
    
    
  • Credit card dues up to Rs. 2 crore
    
    
  • Auto loans up to Rs. 2 crore
    
    
  • Personal loans to professionals up to Rs. 2 crore
    
    
  • Consumption loans up to Rs. 2 crore