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If you are among those who have opted for EMI moratorium on loans or credit card payments, be prepared to resume repayments from next month.
As part of the Pradhan Mantri Garib Kalyan Yojana announced in the wake of Covid-19 pandemic in April, banks had offered EMI deferment facility on all term loans between March 1 and May 31.
From June, customers will have to ensure adequate balance in their accounts for deduction of loans. Banks have already started communicating to the customers about the upcoming instalments.
“We are already sending SMS to customers, alerting them about the need to pay EMIs from next month,” a senior official with State Bank of India told Business Line on Tuesday.
Alerts will also be kept prominently on the portals of the banks, said a functionary with a private sector bank.
CIBIL score
Failure to pay instalments from June will make one vulnerable to a reduction in Cibil scrore. While the EMI moratorium period has been declared as neutral to Cibil score by Reserve Bank of India, customers will lose that facility from June 1 as banks will once again start sharing loan repayment data with Cibil.
Though it received lukewarm response initially, the EMI deferment facility has been availed by a significant number of lcustomers.
According to Rakesh Jha, Chief Financial Officer, ICICI Bank, moratorium aggregates to about 30 per cent of the total loans for ICICI Bank and spreads across all portfolios of loans. It is learnt that in some public sector banks it goes up to more than 40 per cent of the total loans.
Will there be any further extension to deferment of EMIs? As no announcement has been made so far, banks feel a further extension is unlikely.
However, our enquirers with some customers reveal that there is an expectation for extension of the scheme. “I have not been paid salary for the last two months and resumed work only today. Extension of EMI moratorium by least two more months is needed,” Gopal Yadav, said an employee with a jewellery outlet.
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