What is moratorium in banking
Moratorium is a temporary suspension for repayment of loan and credit card installments. In India, under moratorium Reserve Bank of India offers the extension for a decided period (3 months to 6 months usually) to make the repayment of loans and credit card installment. It is also known as the EMI holiday.
When moratorium period in bank is applicable?
- When a nation faces any natural calamity like earthquake, drought, or any other outbreak of a disease.
- Whenever normal life is disrupted and citizens of the country are facing financial hardships.
- This period is over when things get back to normal.
- Live example of moratorium is covid 19 pandemic and on 27 march 2020 RBI declared a moratorium period in the country for a period of three months which got extended to another three months later.
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What is moratorium in banking?
Tanya Nirwal
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2021-06-10T12:00:24+00:00 2021-06-11T11:46:01+00:00Comment
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