Covid-19 impact: Confusion over moratorium norms hit smaller MFIs hard

Many are worried about not being able to meet their loan obligations this month; several either have started defaulting or are about to

With confusion on whether the moratorium announced by the Reserve Bank of India (RBI) in the wake of Covid-19 is applicable to corporate loans, microfinance institutions (MFIs), especially the small and medium ones, are worried that they would not be able to meet their loan obligations this month. Several have either started defaulting or are on the verge of doing so.

During the recent monetary policy meet, the RBI had offered a moratorium of three months to all term loan borrowers who are likely to be impacted by the lockdown due to the Covid-19 outbreak. The RBI statement on the