As a result of the Covid-19 life has come to a halt. Many businesses have been disrupted and as an immediate effect of this many individuals who are under financial obligations have lost their sole source of income. Thus in order to manage the financial stress caused due to the pandemic, the RBI has announced the policy of one-time loan restructuring for various companies and individuals. It has put people and organizations at ease and has helped them manage their financial obligations.
Hence this special one-time loan restructuring policy has acted as a sigh of relief for many businesses and people who were unable to pay back their loans due to lack of funds.
In simple words, one-time loan restructuring refers to making changes in terms of credit by the lender in order to provide assistance and support to the borrowers when he/she is under financial stress. The NPA position of the commercial banks had already reached an adverse level causing a big concern. Hence this special scheme prevents the loan account from falling into the (Non-performing asset ) NPA category and provides relief to them from becoming a defaulter for non-payment of dues on time.
Although the scheme is beneficial for those who are unable to pay their monthly installments on time but in order to avail, the scheme one has to pay a stipulated rate of interest.
The creditworthiness of an individual is assessed thoroughly by the lending institution in order to decide whether the applicant would be able to repay the loan on time.
A loan whose principal amount or interest has not been paid over a period of 90 days or more is considered an NPA and is not eligible for the one-time loan restructuring scheme. The overdue as of 1 March 2020 should not be more than 30 days to be eligible under the scheme.
If you are into the corporate business and are experiencing any financial hassles, then look no further than obtaining the services of the top investment banks. Timely payment of dues/EMI is the key to improve your creditworthiness and to help obtain sources of finance in the future. Hence this once in a lifetime scheme of one-time loan restructuring for corporates and individuals can help you from unnecessary financial distress and help you plan your finances better. It would pave the way for growth for your business and help you plan so as to thrive in the corporate sector and achieve milestones.