{"id":117,"date":"2020-10-24T07:12:12","date_gmt":"2020-10-24T07:12:12","guid":{"rendered":"https:\/\/rvkassociates.com\/blog\/?p=117"},"modified":"2020-10-24T07:18:19","modified_gmt":"2020-10-24T07:18:19","slug":"scheme-for-grant-of-ex-gratia-payment-of-difference-between-compound-interest-scheme-letter","status":"publish","type":"post","link":"https:\/\/rvks.in\/blogs\/scheme-for-grant-of-ex-gratia-payment-of-difference-between-compound-interest-scheme-letter\/","title":{"rendered":"Scheme for grant of ex-gratia payment of difference between compound interest – Scheme Letter"},"content":{"rendered":"\n

F. No. 2\/12\/2020-BOAI
Government of India
Ministry of Finance
Department of Financial Services – Dated 23rd October 2020<\/p>\n\n\n\n

  1. State Bank of India (SBI)<\/li>
  2. All India Financial Institutions (AIFIs)
    -3. All Nationalised Banks<\/li>
  3. All Banking Companies, Urban Co-operative Banks, and Non-Banking Financial
    Companies (NBFCs) registered with RBI
    [through RBI]<\/li>
  4. All NBFC– Micro Finance Institutions (NBFGMFIs) that are members of an
    RBI-recognised Self-Regulatory Organisation
    [through Micro Finance Institutions Network (MFIN) and Sa-Dhan]<\/li>
  5. All State Co-operative Banks, District Central Co-operative Banks and Regional
    Rural Banks (RRBs)
    [through the rural banking system supervisor {National Bank for Agriculture
    and Rural Development (NABARD)}]<\/li>
  6. All Housing Finance Companies (HFCs) registered with the National Housing
    Bank(NHB)
    [through the supervisor of HFCs (National Housing Bank)]
    Subject: Scheme for grant of ex-gratia payment of difference between compound interest
    and simple interest for six months to borrowers in specified loan accounts
    (1.3.2020 to 31.8.2020)
    Madam\/sir,
    The undersigned is directed to convey that in view of the unprecedented and
    extreme COVID-19 situation, the Central Government has approved “Scheme for grant
    of ex-gratia payment of difference between compound interest and simple interest for six
    months to borrowers in specified loan accounts (1.3.2020 to 31.8.2020)”. Benefits under
    the scheme would be routed through lending institutions. Operational guidelines for the
    scheme are attached.<\/li>
  7. Eligibility criteria for ex-gratia payment under the scheme are as follows:
    (a) Borrowers in the following segments\/classes of loans, who have loan
    accounts having sanctioned limits and outstanding amount of not exceeding
    Rs. 2 crore [aggregate of all facilities with lending institutions] as on
    29.2.2020, shall be eligible under the Scheme:
    (i) MSME loans
    (ii) Education loans
    (iii) Housing loans
    (iv) Consumer durable loans
    (v) Credit card dues
    (vi) Automobile loans
    DFS letterF. No. 2\/12\/2020-BOAI, dated 23.10.2020
    (vii) Personal loans to professionals
    (viii) Consumption loans
    Any borrower whose aggregate of all facilities with lending institutions is more than Rs. 2 crore (sanctioned limits or outstanding amount) will not be eligible for ex-gratia payment under this scheme.
    (b) The aforesaid eligibilityshall be subject to the following funher conditions
    and stipulations:
    (i) Account should be standard as on 29.2.2020, i.e., loan should not be a
    Non-Performing Asset (NPA) as on 29.2.2020.
    (ii) Lending institution must be either a banking company, or a Public
    Sector Bank, or a Co-operative Bank [i.e., an Urban Co-operative Bank
    or a State Co-operative Bank or a District Central Co-operative Bank],
    or a Regional Rural Bank, or an All India Financial Institution, or a
    Non- Banking Financial Company or a Housing Finance Company
    registered with RBI or National Housing Bank as the case may be. A
    Non-Banking Financial Company- Micro Finance Institution should
    be a member of a Self-Regulatory Organisation (SRO) recognised by
    RBI.
    (iii) The ex-gratia payment under this scheme shall be admissible
    irrespective of whether the borrower in sub-clause (1) had fully availed
    or partially availed or not availed of the moratorium on repayment
    announced by RBI vide its circular DORNo. BP.BC.47\/21.04.048\/
    2019-20, dated 27.3.2020 and extended on 23.5.2020.<\/li>
  8. The period to be reckoned for crediting of difference between compound interest
    and simple interest by the lending institutions mentioned in paragraph 2(b)(ii) above to
    eligible borrowers as per paragraph 2 above would be from 1.3.2020 to 31.8.2020 (six
    months \/ 184 days). For accounts closed during the said period, the period for crediting
    would be from 1.3.2020 and restricted to the date of closure of such account.<\/li>
  9. The benchmarks and modalities for ex-gratia payment of difference between
    compound interest and simple interest under the scheme would be as detailed in the
    attached operational guidelines. The rate of interest would be as prevailing on 29.2.2020,
    i.e., in case the rate of interest has changed thereafter, it shall not be reckoned for the
    purposes of this computation. The payable ex-gratia amount shall have to be credited to the
    account of the borrower by the respective lending institutions as ex-gratia payment under
    the scheme.<\/li>
  10. The aforesaid exercise of crediting the amount as stated above in the respective
    accounts of the eligible borrowers described in paragraph 2 above by the respective lending
    institution shall be completed on or before 5.11.2020.<\/li>
  11. After the exercise mentioned in paragraph 5 above has been completed, lending
    institutions can lodge their claim for reimbursement latest by 15.12.2020. Claims shall be
    submitted to designated officer(s) \/ cell at the State Bank of India (SBI). SBI is advised to
    appropriately equip its designated officer(s) \/ cell for processing such claims in a timely
    manner, and to notify details of the same on its website.
    Page 2 of 3
    Yours faithfully,
    DFS letter F. No. 2\/12\/2020- BOAl, dated 23.10.2020<\/li>
  12. Issues and concerns relating to claims submitted by the lending institutions shall be
    handled through the designated cell at SBI in consultation with Government of India. Each
    lending institution shall put in place a grievance redressal mechanism for the eligible
    borrowers for redressal of their grievances arising out of the present scheme within one
    week from the date of issuance of these scheme guidelines, at appropriate level(s). W’hile
    putting in place such grievance redressal mechanism, lending institutions can keep in mind
    the communication dated 1.10.2020 issued by the Indian Banks’ Association in respect of
    resolution framework for COVID-19 related stress for guidance. Grievances, if any, of the
    lending institutions shall be resolved through the designated cell at SBI in consultation with
    the Ministry of Finance, Government of India.<\/li>
  13. In case of any issues\/ queries relating to interpretation of this scheme, the decision
    of Government of India shall be finaL<\/li><\/ol>\n\n\n\n

    https:\/\/drive.google.com\/file\/d\/1tNCHGormjLH7Tbr9KCQHgaKJzJFFI8pW\/view?usp=sharing <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

    F. No. 2\/12\/2020-BOAIGovernment of IndiaMinistry of FinanceDepartment of Financial Services – Dated 23rd October 2020 State Bank of India (SBI) All India Financial Institutions (AIFIs)-3. All Nationalised Banks All Banking Companies, Urban Co-operative Banks, and Non-Banking FinancialCompanies (NBFCs) registered with RBI[through RBI] All NBFC– Micro Finance Institutions (NBFGMFIs) that are members of anRBI-recognised Self-Regulatory Organisation[through […]<\/p>\n","protected":false},"author":1,"featured_media":120,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,50],"tags":[52,39,51,53,34],"class_list":["post-117","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","category-ministry-of-finance","tag-aif","tag-banks","tag-ex-gratia-payment","tag-nbfc","tag-rbi"],"_links":{"self":[{"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/posts\/117","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/comments?post=117"}],"version-history":[{"count":2,"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/posts\/117\/revisions"}],"predecessor-version":[{"id":119,"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/posts\/117\/revisions\/119"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/media\/120"}],"wp:attachment":[{"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/media?parent=117"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/categories?post=117"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/rvks.in\/blogs\/wp-json\/wp\/v2\/tags?post=117"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}