EMIs put on hold, 75 bps rate cut as RBI declares war on Covid

Guys, after a long wait, I finally have some excellent news for those of you who have pending EMIs to be cleared. On March 26, the finance ministry has asked the Reserve Bank of India (RBI) to consider implementing a series of emergency measures aimed at helping borrowers cope with the economic havoc wreaked by the Covid-19 pandemic. 

Responding to a likelihood of pause on loan repayments, EMIs and credit card payments, and classification of NPAs, Sitharaman had said: "We will come back soon." and that the discussions were on with the RBI on various issues. "We will do whatever it takes to support... at this stage."

Just in, RBI has given some financial reliefs for borrowers. The RBI Governor declared:

• A three-month moratorium on payment of installments of loans outstanding on March 1, 2020
• Cash Reserve Ratio cut by 100 basis points to 3%
• Repo Rate to be reduced by 75 basis points, from 5.15% to 4.4%
• Auction of targeted long term repo operations of 3-year tenor for total amount Rs 1,00,000 crore at a floating rate.
• Reduction of CRR for all banks by 100 basis points. Will release Rs 1,37,000 crore across the banking system.
• Accommodation under the Marginal Standing Facility to be increased from 2% from SLR to 3% with immediate effect till June 30. It will release Rs 1.37 lakh crore into the system.

Appreciating the RBI's move on the matter, the FM tweeted

EMIs got a 3 months moratorium, but there is yet no light on credit card outstandings. I will update you guys accordingly.

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