Banks are pleading to let them declare non-performing assets.

Looking For a Loan?

I have read the Privacy Policy & Agree to Terms & Conditions and authorize Dialabank & its partner institutions to Call or SMS me with reference to my application.

Why Apply with Dialabank?

Compare across 18 Banks
Get Money in 30 Mins
Loan Amount Up to 5 Crore
Hassle-free Disbursal
Unbiased Experts Advice

Banks are losing money due to these supreme court restrictions and they pleading to ease the restrictions as the banks say that the borrowers don’t need such restrictions anymore. Banks say that they are feeling helpless against borrowers as Salve says to financial express.

Some loan borrowers sent petitions expressing their satisfaction on the matter of the measures taken by the government to address their difficulties on waiver on instalments and loan interests.

banks

The India banks’ association made a strong case on Friday for the order for supreme court’s vacation that restrained banks from classifying accounts as non-performing assets. 

Harish Salve appearing for IBA pleaded argument led by justice Ashok Bhushan to vacate its order of September 3 that directed banks against declaring loan accounts that were not non-performing assets prior to August 31.

Tushar Mehta who appeared for the Centre pleaded in the trials that the apex court should not be involved in the issue of sector-specific loan repayment reliefs and this issue should be resolved by lenders and borrowers.

The apex court asked the Reserve Bank of India to respond to the power producers’ demands for various benefits including loan restructuring under central bank circular on debt recast.

Banks are losing money day by day due to such restrictions and they should be lifted as the need for such protection no longer existed. He argued saying that “ Banks are rendered helpless against defaulting borrowers”. 

On December 2nd the plea from IBAs will be heard said justice R Shubhash Reddy and Mr. Shah.

The power sector asked the supreme court to direct the Union government to tell lending institutions to not charge interest during moratorium periods. The compound interest relief is only for loans up to 2 Cr power companies that haven’t received the benefit. They said that this sector is essential and abused they should be receiving the benefit as well to Reserve bank.

They added that power sector NPAs are due to non paying customers. As the generating companies which are suffering the most have their total debts risen to 1.2 lakh cr.

Meanwhile, the supreme court disposed of various petitions of customer satisfaction for the given moratorium. Senior advocate Kapil Sibbal stated that the bankers’ association had said that everything should work out according to the contract. This means that disasters should not interfere with the clause of the contract. As of September 1, 98% of the industry will become NPA if the court does not protect them.

MSME borrowers will benefit from the reliefs up to 2Cr. loans.

Other petitions are generated by specific industries to give them industry-specific relief because of coronavirus pandemic.

Menu