This year has been one of the worst nightmare any country would
have anticipated. The Indian economy was already slowing in the
past few years with subdued consumer demand and tepid investments,
before COVID-19 pandemic struck.
To address the volatility in the economy, the Reserve Bank of
India (RBI) permitted the lending institutions to allow a three
months moratorium on all term loans outstanding and working capital
facilities on March 27, 2020, being effective from March 1, 2020 to
May 31, 2020, to mitigate the burden of borrowers brought due to
disruption on account of COVID-19 pandemic and also, to ensure
continuity of business. However, the said relief provided by RBI
was not enough, since, the lockdown had extended and there was
continuing disruptions on account of COVID-19 pandemic.
Subsequently, RBI on May 22, 2020, extended this period of
moratorium for another three months, being effective from June 1,
2020 to August 31, 2020.
