The finance government said that that the agriculture and allied activity loans are not fit for the renunciation of interest on interest publicized by the government. Issuing more and more FAQs, the ministry said that the remaining credit card charges on 29th February are to be considered for giving release to the debtors on the scheme for the granting of ex-gratia payment of the difference between compound and simple interest.
The contract rate is the standard rate applicable for such a relief and it also added that the contract rate is then used by the credit card issuers for the EMI Loans purpose.
The crop and tractor loans coming under the agriculture and similar activities loans are no more a part of the 8 segments or classes entitled under the scheme.
As per the FAQs released by the ministry on Wednesday, these are the factors that are considered by the relief – educational loans, MSME loans, consumer durable loans, automobile loans, credit card subscriptions, private credits to professionals, and consumption credits.
As decided by the government, the Reserve Bank of India (RBI) on Tuesday asked all the loaning organizations including the non-banking financial companies to make sure that the system of waiver of interest on interest for loans up to 2 crore rupees for the 6 months suspension period is to be executed by 5th of November.
Loan accounts with authorized bounds and remaining should not go beyond 2 crore rupees will only be allowed and such accounts should be regular in the scene of loaning institutions as on the cut-off date of 29th February 2020.
The refund periods are either 6 months or 184 days starting from 1st March to 21st August 2020. The ex-gratia relief will be credited to the account of all suitable debtors without any condition to apply.
All the loaning organizations should complete the payment difference between compound and simple interest in the accounts of all the suitable debtors in their accounts no matter whether the debtor fully or partly avails the suspension on the reimbursement of the loan said by the RBI on 27th March 2020.
The scheme is additionally applicable to people who haven’t availed of the suspension scheme and continuing with the reimbursement of loans. Rs. 6,500 crore is the amount which is possible to cost the exchequer as per the scheme publicized by the course of the Supreme court.