State-Run Banks Allow Loan Borrowers To Delay EMIs By 3 Months Amid Coronavirus Lockout

Last Friday, the regulator announced a slew of steps to strengthen the financial system against the economic fallout from the spread of COVID-19 disease.

Last week, the RBI permitted banks to take steps to relax the EMI burden on loan borrowers

Many state-run banks have allowed their loan borrowers - customers with active term loan accounts - to delay paying their monthly instalments for a period of three months. Public sector lenders, including the likes of State Bank of India, Punjab National Bank, Bank of Baroda, Canara Bank, Oriental Bank of Commerce and Indian Bank took to Twitter to announce their decisions separately, allowing their term loan borrowers to delay their EMIs due between March 1 and May 31, as the country entered seventh day of the nationwide lockdown to curb the spread of deadly coronavirus pandemic.

The development comes days after the Reserve Bank of India permitted commercial banks as well as other lending institutions to take measures to relax the EMI burden on term loan borrowers in view of the coronavirus-induced lockdown. 

In a statement on Twitter, the country's largest bank by assets, SBI, said it had "initiated steps to defer the instalments and interest/EMIs on term loans falling due between March 1, 2020 to May 31, 2020, and extended the repayment period by three months".

Last Friday, the regulator announced a slew of measures to strengthen the financial system against the economic fallout from the spread of COVID-19 disease, including hefty cuts in key lending rates. It also directed financial institutions to provide relief in the form of delayed EMIs as the three-week lockdown that began on March 25 is currently underway.

The instalments that will be impacted include dues related to the principal or interest portions of loans and credit cards. (Also Read: RBI Eases Loan Repayment Rules. How It Helps You)

The government has maintained that all bank branches and ATMs in the country will remain open during the 21-day period.