Should you avail the 3 Months Moratorium or not?

A simple and straightforward answer to this is, 'Keep Paying your EMIs and Credit Card dues on time if you can.'

Though RBI has allowed banks and other financial institutions to offer a 3-month moratorium on all term loans, you should keep in mind the following:

• It is not a concession or waiver of any kind but is simply a deferment of the payment to provide some relief to borrowers facing a cash crisis.

• Interest shall continue to accrue on the outstanding portion of the term loans during the moratorium, hence after the moratorium ends, it will only increase your burden to pay back the pending outstandings + interest charges.

• If you avail the moratorium, the only benefit you get is that the financial institutions (the lender in your case) cannot tag you as a defaulter. Your credit score remains unaffected at Credit Information Companies (CICs).

• RBI has asked banks to prepare board approved policies to provide relief to all eligible borrowers; hence, each lender will develop its own regimen around the moratorium implementation, and it's going to be fairly complex to understand the T&Cs of different lenders.

However, if you are facing a liquidity crisis and would like to avail of the moratorium, click here for general FAQ.

Thanks for reading!