No compound or penal interest is charged by the borrower for the six-month loan monitorium period from March to August 2020, and if any amounts have already been taken, it can be re-deposited or adjusted. Done. With this ruling of the court, the government will increase the cost of the government from 7000 to 7500 crore.
Anil Gupta, Vice President of ICRA Ltd, estimates that compound interest will be around Rs 13,500 to Rs 14,000 crore during the six-month loan monitorium. The government has already announced a loan of Rs 6,500 crore to the tune of Rs 2 crore. After the Supreme Court announcement, the government will still have to pay Rs 7000 to Rs 7500 crore.
The court today refused to extend the moratorium period, rejecting an appeal by the Traders Association and people seeking a waiver of interest on the loan ban period. The difference between compound interest and simple interest was charged to loans up to Rs 2 crore. The Supreme Court has refused to interfere with the decision of the central government and the Reserve Bank of India (RBI) not to extend the debt ban beyond August 31, 2020, saying it was a policy decision. The Lone Moratorium was announced last year in the wake of the corona virus epidemic.
Debt bans: Supreme Court says – Full interest waiver cannot be extended
