State Bank of India (SBI) clarified that the rescheduling of term loan payments will come at some additional cost and those with the ability to make payments should continue to do so. The clarification came after the central bank last week directed banks to provide a three-month moratorium on term loan repayments to help borrowers mitigate the impact of the COVID-19 outbreak. The payments deferral will apply on payments due between March 1 and May 31.
The facility would be a deferral of payments, rather than a waiver, and would consequently come at a cost. However, the additional cost accrued will be back-ended during the repayment period. For those customers who have already paid in March and want to avail a refund, the facility would be available as well. There are two-three types of customers. Some customers have given standing instructions to us, he has a loan account with us, as well as a savings and current account with us, every month his savings account is debited and credited to our loan account. We told them simply to send an email, we will ensure that whatever amount that has been recovered by March will be credited to your savings account.
The other category of borrowers, who have taken loans from SBI but have an account in a different bank, SBI will take some time to stop the automated clearing house (ACH) facility, which is in place. Customers will have to send in writing to the bank seeking a refund. The bank also announced an emergency credit line for COVID-related to help stressed borrowers deal with the pandemic-outbreak related financial stress.