Does moratorium cover loans to NBFCs, Sidbi queries RBI
Sidbi’s query follows a Delhi High Court decision on a plea by Indiabulls Commercial Credit (ICC) seeking benefit of the moratorium that had been announced by the RBI on March 27 as part of reliefs for borrowers on account of the Covid-19 pandemic.
The HC disposed of the case as “infructuous with the clarification that the respondent (Sidbi) will not raise any further demand on the petitioner (Indiabulls Credit) towards the due installments against the petitioner till it obtains a clarification from respondent 2 (RBI).”
Mumbai: Small Industries Development Bank of India has asked the RBI to clarify whether the three-month moratorium it announced recently will apply to loans given to nonbanking finance companies. The central bank’s ruling could determine the fate of NBFCs that are strapped for liquidity.
Sidbi’s query follows a Delhi High Court decision on a plea by Indiabulls Commercial Credit (ICC) seeking benefit of the moratorium that had been announced by the RBI on March 27 as part of reliefs for borrowers on account of the Covid-19 pandemic.
Sidbi’s query follows a Delhi High Court decision on a plea by Indiabulls Commercial Credit (ICC) seeking benefit of the moratorium that had been announced by the RBI on March 27 as part of reliefs for borrowers on account of the Covid-19 pandemic.
The HC disposed of the case as “infructuous with the clarification that the respondent (Sidbi) will not raise any further demand on the petitioner (Indiabulls Credit) towards the due installments against the petitioner till it obtains a clarification from respondent 2 (RBI).”
Sidbi Awaiting RBI Response
Sidbi had told the court that there was no clarity yet on the matter. Sidbi is yet to get any response from the central bank, according to a senior executive with direct knowledge of the matter. “There are other PSU lenders that have likely reached out to RBI for similar clarifications,” the person said
Sidbi had told the court that there was no clarity yet on the matter. Sidbi is yet to get any response from the central bank, according to a senior executive with direct knowledge of the matter. “There are other PSU lenders that have likely reached out to RBI for similar clarifications,” the person said
ICC had entered into a Rs 750-crore loan agreement with Sidbi and had borrowed Rs 575 crore of the amount. The Mumbaibased NBFC paid dues of Rs 31 crore as per the agreed payment schedule on March 9. The credit had been extended for onward lending to micro, small and medium enterprises (MSMEs). Crisil had rated ICC ‘AA’ with a negative outlook for its long-term bank loan facilities.
WAITING FOR CLARIFICATION
Senior advocate Rajiv Nayar, who appeared for Indiabulls.
WAITING FOR CLARIFICATION
Senior advocate Rajiv Nayar, who appeared for Indiabulls.
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