Declare Loan Moratorium Amid COVID Second Wave : Lawyer Makes Representation Before Centre & RBI

The representation has been made by Advocate Vishal Tiwari, in the light of the observations made by the Apex Court while disposing of his writ petition filed seeking financial relief in the form of fresh loan moratorium, extension of time period under the restructuring scheme and temporary cease on the declaration of NPA by the financial banks in the wake of the COVID-19 pandemic.

" We, however, observe that all the issues, which are raised, are policy matters and it is for the Union of India and the Reserve Bank of India to consider and take appropriate decision." the Court had observed while refusing to order loan moratorium extension.

While noting that the Apex court has also held that the Government can adopt decisive policy in financial matters, the Representation has requested the Government and Reserve Bank of India to take necessary steps to benefit borrowers in the following ways:

• By providing relaxation in paying EMI's,
• By not turning the Accounts NPA By not evicting, dispossessing and auctioning of any property by the lending institutions till the Situation eases and normalises
• By protecting the borrowers from the illegal and violent methods of Recovery.

The representation has stated that the circular issued by RBI on May 5th 2021 as "Resolution "lan 2.0 for the MSMEs and Individual borrowers" is not sufficient to provide immediate relief to the borrowers in the present pandemic, as it speaks about eligibility criteria which prevents the vast number of borrowers from getting benefit of it.