Cabinet approves grant of an ex-gratia payment for six months to borrowers in specified loan accounts
New Delhi, January 20, 2022
The Union Cabinet on Wednesday approved the payment of an ex-gratia amount of Rs 973.74 crore on remaining claims submitted by Lending Institutions (LIs).
The payment will be made on the difference between compound interest and simple interest for six months to borrowers in specified loan accounts (1.3.2020 to 31.8.2020).
By granting the payment during the six month moratorium period to the distressed/vulnerable category of borrowers, the scheme would help them overcome the stress on account of the pandemic and get back on their feet. The scheme will apply to all such borrowers irrespective of their having availed of the moratorium.
Operational guidelines for the scheme have already been issued with the approval of the Cabinet. This amount of Rs 973.74 crore will be disbursed under the operational guidelines.
In the context of the COVID-19 pandemic, the scheme was approved by the Cabinet in October 2020, envisaging an outlay of Rs 5,500 crore. The category of borrowers eligible for the ex-gratia payment include loans up to Rs 2 crore in MSME, Housing loans, Consumer durable loans, Credit card dues, Auto loans, Personal loans to professionals and Consumption loans.
A budget allocation of Rs 5,500 crore was made for the scheme in FY 2020-2021. The entire amount of Rs 5,500 crore, as approved by the Cabinet, has been disbursed to SBI, the nodal agency under the scheme, for consequent reimbursement to lending institutions.
The estimated amount of Rs 5,500 crore was arrived at by extrapolating the share of SBI and Scheduled Commercial Banks for the aforementioned category of loans. The actual amount would be known once individual lending institutions submit their pre-audited account-wise claims.
SBI has informed that it has received consolidated claims of Rs 6,473.74 crore approximately from lending institutions. As Rs 5,500 crore has already been disbursed to SBI, approval of the Cabinet was sought for the remaining Rs 973.74 crore.