RBI extends loan repayment window to 90 days

The Reserve Bank of India (RBI) gave borrowers another 30 days over and above 60 days for repayment of housing, car, farm and other loans worth up to Rs 1 crore in further relief to people hit by demonetisation. It has asked lenders to provide borrowers 90 days for repayment loans. It will be applicable to dues payable between 1st November and 31st December. So, borrowers together get 90 days from getting the account classified under non-performing asset (NPA) category. Following the surprise demonetisation announcement made on November 8, 2016 to scrap high value Rs 500/1,000 notes resulted in cash crunch in the market leading to slowdown in business. As a result, repayment capacity of borrowers were impacted and there was fear of loan default rising.