LOAN RESTRUCTURING FACILITY – WHY IT IS A BIG BOON FOR MSME BORROWERS

One of the most important questions that business own-ers have been asking them-selves and each other during the month of August 2020 has been whether the moratorium announced by RBI on the loan payments will be extended again.

- Jiz P Kottukappally

No doubt the benefits of moratorium on loan repayments announced by RBI has helped a large number of borrowers to tide over or at least minimize the challenges of inadequate cash flows. Though the lockdown was for less than 2 months and more than 2 months have passed since the partial lifting of lockdown has started, business is not back to normal for most of the firms. Revenues and cash flows are still under stress and naturally many of the borrowers are looking at an extension of the moratorium and hence the questions regarding possibility of extension of moratorium were being asked.