There is another round of compound interest waiver likely as the Supreme Court on Tuesday said all borrowers, irrespective of their outstanding loans, should be eligible for this. Icra Ltd has estimated the additional cost to be Rs7,000-7,500 crore
MUMBAI: State Bank of India (SBI), in charge of collating and settling compound interest waiver reimbursement claims by lenders for the last round of the interest waiver scheme during the moratorium, has declined to provide information on the quantum of claims it received.
Responding to a Right to Information (RTI) query filed by Mint, the bank first said in January that the information sought is exempted under Section 8(1)(d) of the RTI Act 2005. “Moreover, the same is held by us in a fiduciary capacity & hence exempted from disclosure under Section 8(1) (e) as well. Therefore, cannot be parted with," it said. Thereafter, an appeal was also disposed off in February on the same grounds.
In October, the government had appointed SBI as the nodal agency and said it will receive funds for settlement of such claims. Other lenders were told to submit their claims by 15 December to India’s largest lender.
It has, however, been estimated that the government has paid Rs6,500 crore to lenders against compound interest waiver of a segment of borrowers for the moratorium period of March to August last year.
Last year, the government had announced that retail and small business loans up to Rs2 crore will get the benefit of compound interest waiver. Eight sectors where this benefit was extended to are micro, small and medium enterprises (MSMEs), education loans, housing, consumer durables, credit card dues, auto loans, personal and professional loans and consumption loans. The moratorium announced to help borrowers tide over the covid-induced crisis ended on 31 August.
There is another round of compound interest waiver likely as the Supreme Court on Tuesday said all borrowers, irrespective of their outstanding loans, should be eligible for this scheme. Analysts at rating agency Icra Ltd have estimated the additional cost to be anywhere between Rs7,000-7,500 crore.
“There is no justification shown to restrict the relief of not charging interest on interest with respect to the loans up to ₹2 crore only and that too restricted to the aforesaid categories," the Supreme Court said in its order.