Скачать или смотреть The Scheme for Ex-Gratia Payment- Lockdown Cashback on EMI Moratorium

Know all about Ex-Gratia Scheme, Eligibility for Lockdown Cashback, process to apply, tax applicability with MyLoanCare.

To provide relief to the borrowers amid COVID pandemic, RBI announced EMI Moratorium on all the loan products and credit card facilities. Borrowers were provided with the option to voluntarily opt for the Moratorium scheme for the period starting from March 1, 2020, till August 31 2020.
During this period, the borrowers did not have to pay any interest or principal amount. However, the Interest in these products was charged on compounding interest basis.
After the moratorium period, the Supreme Court made a decision to waive off Interest on Interest. It meant that the Interest would be charged on Simple Interest Basis.
Thus, as per the directions of Supreme Court, all the lenders had to credit the payment of the difference between compound Interest and simple Interest on loans up to Rs 2 crore during the loan moratorium scheme by November 5, 2020.
This Scheme is known as "Scheme for grant of Ex-gratia and is made to reimburse the compound interest charged during the given period.

Difference between compound & Simple Interest

Compound Interest- It is the Interest on Interest, which is charged on the outstanding amount and thus changes for every EMI.

Simple Interest- Under this method, the Interest is charged on the same principal amount every time.


Eligibility criteria for Ex-gratia payment under the Scheme are as follows:

(a) Borrowers who have loan accounts upto Rs. 2 crores as on 29.2.2020, shall be eligible under the Scheme for the following loan products:
(i) MSME loans
(ii) Education loans
(iii) Housing loans
(iv) Consumer durable loans
(v) Credit card dues
(vi) Automobile loans
(vii) Personal loans to professionals
(viii) Consumption loans

To avail, EMI Moratorium Cashback offers your account should be standard as on February 29 2020.
The loan should be taken from a recognised lending institution including bank, NBFC, housing finance company, credit card issuer etc. to avail the benefit of this Scheme.
The Scheme is also eligible for the borrowers who did not opt for the moratorium option.


How to apply for the cashback on moratorium?
Most of the banks have already transferred the cashback amount to the borrowers' account. Borrowers do not need to fill any application form for receiving such cashback as lenders will automatically credit the amount to their accounts.

Tax on ex-gratia payment
The ex-gratia amount or cashback will be treated as income and thus is taxed at the normal slab rate.

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