If you have a bank loan that you are unable to repay, a restructuring is underway

  • The Reserve Bank of India (RBI) is considering ad hoc restructuring of all loans, including personal loans.
  • As long as you haven’t defaulted on your loans by March 1, 2020, you can request to change your loan repayment plan.
  • RBI has set a deadline of December 1, 2020 for all restructuring requests to be initiated and implemented within 90 days of being invoked.

Auto loans, home loans, or any type of personal loan that you could not make payments for are now eligible for restructuring. The Reserve Bank of India (RBI) has announced that it will open a window for a loan restructuring – all loans – which have been impacted by COVID 19.

Loans Under Moratorium with Banks Across India as a Percentage of Total Loans Outstanding RBI Financial Stress Report / BI India

This means that you are having trouble repaying your personal loans, you can ask the bank to change the repayment terms, get additional credit to rebuild or even extend the moratorium period. The minimum credit requirement is that you have not defaulted on your loan payments by March 1, 2020 or within 30 days of that day. The outstanding debt at that time will be taken into account for restructuring.

You have until December 31 to request a new payment plan
According to the RBI Circular, the resolution under the new mechanism must be invoked by December 31, 2020. Once invoked, it must be implemented within 90 days. However, RBI suggests that banks and other lending institutions should try to launch their plans earlier than the due dates.

The resolution could include the following features:

  • Rescheduling of payments
  • Conversion of accrued interest into another credit facility
  • Granting of a moratorium
  • Modification of the overall content of the loan

The terms and conditions of how this will be determined based on your projected income streams over the next two years.



Provided the restructuring plan is put in place on time, your loan will not be classified as a non-performing asset (NPA). However, if this is not the case, the loan rating will be made based on the actual performance of the borrower.

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