Plea in SC to restrain banks from declaring defaulting loan a/cs NPA

Tribune News Service

New Delhi, June 5

A petition has been filed in the Supreme Court seeking directions to government and the RBI to restrain banks from declaring loan accounts as NPAs for the non-payment of EMIs. The relief has been sought in view of the lockdowns during the second wave of Covid-19.

The petitioner, NGO Trust Distress Management Collective, urged the court to direct the RBI to ask banks not to classify any loan as NPA for non-payments of EMIs at least for five months beginning April.

It said the RBI should permit banks to offer a fresh moratorium to borrowers in view of the adverse financial impact of the second wave of Covid-19 and the government should consider a stimulus package to help borrowers deal with the situation.

It sought to highlight that last year, when the situation was not as bad as that during the second wave, the RBI had announced a moratorium for three months and subsequently extended it to six months and had also allowed restructuring of loans.