RBI allows one-time restructuring of MSME loans of up to Rs 25 crore

The Reserve Bank of India (RBI) on Tuesday introduced a one-time restructuring scheme for micro, small and medium enterprises (MSMEs) with a maximum exposure of Rs 25 crore.

The restructuring has to be implemented by March 31, 2020. Banks have to incur an additional provision of 5 per cent for these restructured accounts, the RBI said in a notification on its website. 

To be eligible, the MSME account should remain a ‘standard asset’ as of January 1. Accounts in default can be restructured, provided their asset classification has not been downgraded.

“Any MSME account which is restructured must be downgraded