The Reserve Bank of India last week announced an extension in the moratorium on payment of all the term loans by another three months. Owing to the hardships faced by the borrowers in the wake of coronavirus pandemic, the loan moratorium now extended till August 31. Earlier, the central bank had allowed a three-month moratorium on repayment of all term loans due between March 1, 2020 and May 31, 2020.
Term loans includes all kinds of retail loans such as personal loan, auto loan, home loan, agricultural term loans as well as crop loans. The credit card dues will also be eligible for the moratorium option, the central bank later clarified. The moratorium will be provided for both interest as well as principal repayment, which means the moratorium is applicable for your equated monthly instalments or EMIs.
Here are the five things you need to know about RBI moratorium option for credit cards
1) If you opt for the moratorium on your credit card bill, you do not need to pay anything till August 31. Customer does not even require to pay the minimum due amount on your credit card bill every month.
2) The banks won't charge any late fee for the next three months as moratorium service has been enabled. If you have have switched on 'auto-pay'option on your credit card, you need to turn it off to avail this new facility.
3) Your CIBIL score or credit score won't be affected if you don't pay your credit card dues till August. CIBIL Score is a three-digit numeric summary of your credit history.
4) Customers need to understand that the banks will charge interest towards the unpaid dues during this period. The moratorium allows a deferment of credit cards dues but it is not a waiver of interest charges which will continue to accumulate on the outstanding amounts.
5) So, if your cash flows are not affected due to COVID-19, the financial advisers recommend you to pay the your credit card bill on time to avoid accumulation of interest charges.
Click here to read the Mint ePaper Livemint.com is now on Telegram. Join Livemint channel in your Telegram and stay updated
