Banks offer cashback concession on timely EMI payments!
Posted on: 26/Oct/2020 9:03:42 AM
Even while closing the loan, in case of timely and regular EMI payments, the bank will offer ‘cashback’ concession!
When the ‘loan moratorium’ has not been obtained and regular EMI has not been paid, the bank will have a cash transaction on that account.
The Central Government has explained in detail regarding its decision on the issue of charging interest on interest for the loan taken.
The customers who pay EMIs regularly and in time will get some benefits.
The Central Government has clearly explained that in case of failure to avail the moratorium as an advantage and failure to make the EMI Payments, these customers will have cash transactions from the bank. Under this proposal, those who have taken the above sort of loan will avail the benefit of the difference between the simple and compound interest for a period of 6 months.
Concession given due to the coronavirus pandemic
In case of the prevailing lockdown conditions as a preventive measure against the spread of the raging coronavirus pandemic and the huge hardships encountered by the customers, the Reserve Bank of India gave a break of 6-months on loan EMI repayment.
The citizens who could arrange/afford to pay the EMI as per the above situation availed the above RBI concession. At the same time, even during the period of the moratorium period, many citizens have paid the EMI as regular. The banks are set to offer some concessions to these customers!
The above Differed EMI payment (moratorium) period was from 1st March to 31st August. Later, the issue of charging interest on interest during the moratorium period was taken up in a petition to the Supreme Court. The central government declared that there is no need to pay the interest on interest as demanded. The central government stands to incur a loss of Rs. 700 Crores on this!
Concession given for loans up to Rs. 2 Crores
Recently, the central government had announced that it cancels the interest on interest for loans taken up to Rs. 2 Crores.
In a bonded declaration submitted to the Supreme Court, the central government had declared that the interest on interest, as applicable to loans such as MSME (Micro/Small/Medium Enterprises), Education, Housing, and consumer-based will be withdrawn. As per this declaration by the central government, during the 6months’ period of the moratorium, the interest on interest for loans up to Rs. 2 Crores will be withdrawn.
