Rajnish Kumar, SBI NSE chairman on Friday said close to 20 percent of the bank’s borrowers have opted for a moratorium on repayment of term loan installments.
A three-month moratorium on payment of all term loans falling due between March 1, 2020, and May 31, was announced on 27 March 2020.
The RBI allowed banks and other lending institutions to extend the moratorium on loans by another three months — from June 1, 2020, to August 31, 2020, on Friday.
“In the case of SBI, the percentage of borrowers who have opted for the moratorium is very small, around 20 percent,” Kumar told reporters through a video conference.
The liquidity issue is not faced by all who have opted for the moratorium, SBI Chairman said.
“Many of them could have serviced their loans but as a matter of strategy they would want to preserve their cash and have opted for the moratorium,” SBI Chairman said.
Kumar also advised borrowers to pay their loans if they are not facing any funding challenge.
If people are able to pay (EMIs) they should pay. If they are unable to pay then only they should take the benefit of the moratorium,” he said.
According to Kumar, the RBI’s moratorium will take care of the cash flow disruption of borrowers and there might not be an urgent need for a dispensation of one-time restructuring of stressed accounts from the RBI.
“Right now, the moratorium will take care of the situation around the cash flow disruptions.
I would not be obsessed with one-time restructuring at this particular point of time when we have time till August 31,” he said.
He, however, said banks can go for debt recast even today as per the June 7 circular of the RBI.
Banks and NBFCs have been requesting the RBI to allow them for a one-time restructuring of their accounts where the borrowers are facing funding issues.