Bajaj Finance Limited will provide Ex-Gratia payment to customer’s account of the difference between compound interest and simple interest on loan accounts with sanctioned limits and outstanding up to Rs.2 crores (aggregate of all the borrowings/ facilities from all the banks and financial Institutions) for the period from 1st March 2020 to 31st August 2020 (6 months / 184 days). If the interest rate is 14%, Rs 210 will be credited. The ex gratia relief will be credited to the account of all eligible borrowers without any requirement to apply, it said. What Rate of Interest (%) shall be considered for calculating the package, i.e. The contracted rate / interest rate prevailing as on 29.02.2020 which is considered 16. Any requests and queries for Ex-Gratia interest refund will be taken until 30th Nov’20. The Department of Financial Services has issued a set of Frequently Asked Questions (FAQs) on the interest waiver scheme, or the scheme of ex-gratia payment of difference between simple and compound interest to eligible borrowers for a six month period between March 1 and August 31, 2020.Get latest Economy online at cnbctv18.com Treated like drug addict: Black doctor alleges racism at hospital; dies of Covid, What agitating farmers want, and why the Centre may not oblige, The Rajinikanth dilemma in Tamil Nadu politics, Battered Congress looks at hard road ahead, 10 infants die in fire at Bhandara hospital in Maharashtra, Twitter permanently suspends Trump's account, cites 'incitement of violence' risk, 2 Made-in-India coronavirus vaccines ready to save humanity, says PM Modi, Trump finally concedes defeat, promises orderly transition, IAF planes to supply Covid-19 vaccines to remote areas of the country. The ex-gratia amount is treated as income and taxed at the normal slab rate. • Please select: The Finance Ministry has approved guidelines for a scheme to grant ex-gratia payment of the difference between compound interest and simple interest for … No, Bajaj Finance Limited will process and credit your loan account on or before 5.11.2020. Do I need to place a request to get the Ex-Gratia Interest refund? Below is a sample calculation of Ex-Gratia amount for different rate of interest -. So, all the banks and financial institutions are expected to credit the refund or cashback to eligible borrowers by the end of the day. Yes, “partially disbursed loans” are covered under the relief package provided that the sanctioned and outstanding amounts do not exceed Rs. Eligibility and Dates of Reserve Bank of India Ex Gratia Scheme The ex-gratia payment under the government’s interest waiver scheme will be admissible irrespective of whether the borrower has fully or partially availed the moratorium. About SRA. Loan accounts with sanctioned limits and outstanding not exceeding Rs.2 crores (aggregate of all facilities with all the lending institutions) as on 29.02.2020. 3. The Ex-Gratia Payment Scheme is the payment of the difference between the Compound Interest and the Simple Interest for six months ending 31 August 2021 to borrowers in specified loan accounts. • MSME: In respect of term loans / Demand Loan, the rate of interest for the purpose of calculating the differential will be the contracted rate as specified in the loan agreements/ documentation applicable as on 29th February 2020. BP.BC.47/21.04.048/2019-20 dated 27.03.2020 and extended on 23.05.2020. Loan accounts should be standard in the books of the lending institutions as on 29.02.2020. In view of the unprecedented and extreme COVID-19 situation, the object of the Scheme is to provide ex-gratia payment of the difference between compound interest … Tax on ex-gratia payment. The government had earlier asked the banks to refund the difference between simple and compound interest to eligible borrowers on or before November 5. Any requests and queries for Ex-Gratia interest refund will be taken until 30th Nov’20. NEW DELHI: In a festival gift to borrowers, the finance ministry on Wednesday approved guidelines for a scheme for grant of ex-gratia payment of the difference between compound interest … Ex gratia (/ ˌ ɛ k s ˈ ɡ r eɪ ʃ (i) ə /; also spelled ex-gratia) is Latin for "by favour", and is most often used in a legal context. No. Do I apply for the relief/Ex-Gratia Scheme? The ex-gratia relief will be credited to the account of all eligible borrowers without any requirement to apply, it said. • In respect of Education loans, Housing loans, Automobile loans, Personal loans to professional loans, the rate of interest to be applied for calculating the differential interest component shall be the contracted rate as specified in loan agreements/ documentation applicable as on 29th February 2020. What are the eligibility criteria of the ex gratia scheme? Last Friday, the government had announced the scheme for grant of ex gratia payment of difference between compound interest and simple interest for six months to borrowers in specified loan accounts. If I have already closed my loan account after 1st March 2020, how will the differential amount be paid to me? November 9, 2020. While the loan moratorium case is still being heard in Supreme Court, the government had recently passed a scheme to “grant ex-gratia payment of the difference between compound and simple interest to borrowers of specified loan accounts” from March 1, 2020 to August 31, 2020. Agriculture and allied activity loans are not eligible for the interest on interest waiver announced by the government last week, the finance ministry has clarified. # Will I get the Ex-Gratia interest refund if my loan account is NPA? “In view of the unprecedented and extreme Covid-19 situation, the object of the scheme is to provide ex gratia payment of difference between compound interest and simple interest by way of relief for the period from March 1, 2020 to August 31, 2020 to borrowers in specified loan accounts. Viman Nagar, Pune – 411014, IRDAI Corporate Agency Registration Number, Loan Against Property For Chartered Accountants, Hybrid Flexi Personal Loan EMI Calculator, Platinum Choice First-Year-Free SuperCard, Pre-approved category on Smartphones and Laptops, PRE-APPROVED OFFERS ON KITCHEN APPLIANCES, Home, Kitchen appliances & Furniture on EMI, PRE-APPROVED OFFERS ON FITNESS, TRAVEL, FASHION. Yes. The outstanding as on 29.02.2020 will be the reference amount for calculating the differential. The period reckoned for refund shall be from March 1 to August 21, 2020 that is six months period or 184 days, it said. Non-fund-based limits will not be included for arriving at the eligibility. The ex gratia relief will be credited to the account of all eligible borrowers without any requirement to apply, it said. Submitted by admin on Tue, 10/27/2020 - 19:25. • In respect of consumer durable loans, the rate of interest to be applied for calculating the differential interest component shall be the contracted rate as specified in loan agreements/ documentation. Earlier this month, in the matter of interest relief to borrowers during the moratorium, the Centre had promised to make good the interest on interest. What will be the treatment of penal interest/ penalties while arriving at the rate of interest? I have taken partial Moratorium; will I be eligible for this relief package? I have a query related to COVID-19, Ex-Gratia Interest relief. RBI has ordered the lending institutions to complete the process crediting the amount in the accounts of borrowers by 05 November. 11. For consumer durable loans, the rate of interest which will be applied for calculating the interest on interest benefit shall be contracted at the same rate as specified in the loan agreement. The period reckoned for refund shall be from 1st March 2020 to 31st August 2020. Click here to register your E-mandate and update alternate bank account details. The Reserve Bank of India then asked all banks in the country to refund the difference between simple and compound interest to all eligible borrowers under the scheme. A voluntary payment made by the reinsurer in response to a loss for which it is not technically liable under the terms of its contract. It may be noted that all individual borrowers and small businesses with loans up to Rs 2 crore are eligible for a refund or cashback under the government’s loan moratorium compound interest waiver scheme. The ex gratia relief will be credited to the account of all eligible borrowers without any requirement to apply, it said. 2.1 Ex-Gratia Lump-Sum Payments ... administrator in respect of such refunds (including interest on the contributions, if any), unless the refund is re-invested in another pension scheme. Interest-on-interest waiver: Crop, tractor loans not part of ex-gratia relief scheme. Ex-gratia will not be paid on those credit cards where balance is in “credit” as on 29.02.2020. This penal interest would have been charged for the installments which were not paid during the moratorium period in the case of Term Loans. • Click here and and login to Customer Portal Experia For reprint rights: Syndications Today, Some banks have already started refunding eligible borrowers under the scheme from November 3. Also, for the employees who come under the Bonus Act and wishes to pay ex-gratia beyond 20% of wages, it is given in the name of Ex-gratia. As soon as the banks and financial institutions complete the process of crediting the interest on interest waiver, they can claim a reimbursement from the government. Ex Gratia Payment is a scheme announced by Government of India for the payment of the difference between compound interest and simple interest for six months to the borrowers on loan accounts with sanctioned limits and outstanding upto Rs. 3. Ex gratia payments in settlement agreements are great things if you can get them, because they offer a unique tax break only really available to employees who are leaving work after a dispute or redundancy situation. Customers will not be able to avail this facility for these loans below: Any repayment / credits subsequent from 01.03.2020 – 31.08.2020 shall be ignored for the purpose of calculation. What is the ex gratia payment to the borrower under the scheme announced by Ministry of Finance, Government of India dated 23rr October 2020 Q4. Applicability of the scheme My EMIs were bounced during the Moratorium period, will I be eligible for interest Ex-Gratia refund? No. The compound interest works out to a very small amount. If you applied for ex gratia relief and are denied before payment, you must still pay your tax liability. New Delhi: The Reserve Bank of India (RBI) issued direction on Tuesday to all lending institutions to implement provisions of Scheme for grant of ex-gratia payment of difference between compound and simple interest for six months to borrowers in specified loan accounts (1 March to 31 Aug) and take necessary action within the stipulated time. The bank/ lending institution will provide ex-gratia payment to the borrower account of the difference between compound interest and simple interest on loan accounts with sanctioned limits and outstanding upto Rs. No. • Select your query under the tab: Add New Query Will I get the Ex-Gratia interest refund if my loan account is NPA? • The Ex-Gratia Payment will be admissible irrespective of whether borrower has opted for Moratorium or not opted for moratorium on repayments during COVID-19 period. What is the last date for raising queries relating to Ex-Gratia? The period reckoned for refund shall be from March 1 to August 21, 2020 that is six months period or 184 days, it said. BP.BC.47/21.04.048/ 2019-20, dated 27.3.2020 and extended on 23.5.2020. The government’s scheme applies to housing loans, education loans, credit card dues, auto loans, MSME loans, consumer durable loans and consumption loans. In case the loan is closed and there is no overdue in any other loan, the amount will be refunded in your registered bank account. Those who had not availed the moratorium will also get the benefit of the scheme.   • Query Type: Interest Refund Will I also be eligible for Ex-Gratia interest refund? My Loan has been restructured, what is the impact of the same? The ex-gratia relief will be credited to the account of all eligible borrowers without any requirement to apply. Customers whose aggregate of all loans with lending institutions is less than Rs. How will the list get finalized for the ex gratia to borrowers scheme? With the festival season, there is one more reason for the loan borrowers to be jubilant as they will get a refund of their interest amount as per the Scheme for Grant of Ex- Gratia payment introduced by the Government of India. Interest-on-interest waiver: Crop, tractor loans not part of ex-gratia relief scheme. Upon credit of the differential amount to the respective loan account(s), BFL will notify the same to you vide an SMS to your registered mobile number. Any requests and queries for Ex-Gratia interest refund will be taken until 30th Nov’20. The payable ex-gratia amount shall have to be credited to the account of the borrower by the respective lending institutions as ex-gratia payment under the scheme on or before 5.11.2020. The ex-gratia relief will be credited to the account of all eligible borrowers without any requirement to apply. So how will customers know if they have been refunded or have received a cashback? The outstanding as on 29.02.2020 shall be the reference amount for calculating the differential interest amount. The relief will come to borrowers in the form of grant of ex-gratia payment of difference between compound interest and simple interest for six months (from March 1 to August 30). c. The relief shall cover the following segments – MSME Loans, Education loans, Housing Loans, Consumer Durable Loans, Credit Card Dues, automobile loans, personal loans to professional loans. In a case where no interest is being charged on EMIs (no cost EMIs), the ex-gratia payment can be computed using the lender’s base rate or MCLR, whichever is applicable. Latin for “by favour”. Ex gratia payments are also known as ‘golden handshakes’ or ‘golden boots’. Home Whatsnewstatic FAQs for scheme of Ex gratia payment to borrowers for difference in interest. Loan moratorium: Do you have to apply for govt’s interest waiver scheme? loan moratorium Centre issues guidelines for loan interest waiver, check how much money may be returned. The period reckoned for refund shall be from March 1 to August 21, 2020, that is six months period or 184 days, it said. I have been paying my EMI’s in cash, will I get the refund in cash or cheque? Under the ex-gratia scheme of government, any loan of up to Rs 2 crore taken before February 29, 2020 will not be charged with compound interest from March 1 to August 31, 2020. Yes, you would be eligible for the scheme. No. The bank/ lending institution will provide ex gratia payment to the borrower account of the difference between compound interest and simple interest on loan accounts with sanctioned limits and outstanding upto Rs. Such payments include compensation due or 32 views From a borrower’s perspective, the benefit would be relatively higher for those who had availed of higher-yielding loans. An ex gratia payment is made to an individual by an organization, government, or insurer for damages or claims, but it does not require the admittance of liability by the … As per the directive from the Centre, all individual borrowers and small businesses with loans up to Rs 2 crore are eligible for a refund in loan moratorium compound interest waiver scheme. Such borrowers are eligible for refund of differential interest from 1st March 2020 upto the date of closure of account (not later than 31st August 2020). • For queries related to COVID-19, Ex-Gratia Interest Relief, you may please follow the steps here for support: 2 crores (aggregate of all the borrowings/facilities from all the banks and financial Institutions) for the period from 1st March 2020 to 31st August 2020 (6 months / 184 days). all individual borrowers and small businesses with loans up to Rs 2 crore, Loan moratorium interest waiver scheme: All your questions answered. ... the government had recently passed a scheme to “grant ex-gratia payment of the difference between compound and simple interest to borrowers of specified loan … When something has been done ex gratia, it has been done voluntarily, out of kind or grace.In law, an ex gratia payment is a payment made without the giver recognising any liability or legal obligation.. Borrowers who had not opted for the moratorium are also eligible for a refund if they meet the eligibility criteria. Will my Non-Fund based limits as on 29-02-2020 be included for arriving at the eligibility amount of up to INR 2 crore? Calculation of ex-gratia. We will assess this based on information available with us, as well as information accessible from credit bureaus. The relief will be available to you irrespective whether you have availed or partially availed or not availed the moratorium on repayment as announced by RBI vide DOR. In the text message, banks are expected to share the exact amount of refund or cashback given to the eligible borrowers. Reach us via call, SMS, e-mail, or visit one of our branch offices. (Photo: Reuters/Representational image), Loan moratorium: How to know if bank has credited ‘interest on interest’ refund, expected to credit the refund or cashback to eligible borrowers by the end of the day. What's New; Attachment File Date 2 crores (aggregate of all the borrowings / facilities from all the banks and financial Institutions) for the period from 1st March 2020 to 31st August 2020 (6 months / 184 days). 4. ROI (%) considered at the time of sanction or ROI (%) as on 29.02.2020? Take a loan of Rs. Even a week after the finance ministry approved a scheme for grant of ex-gratia payment of the difference between compound interest and simple interest for six months of loans up to Rs 2 crore, borrowers are still wondering how they will benefit from the scheme. The loan will entail only simple interest. The loan will entail only simple interest. You can click here to login to Customer Portal Experia and go to My Relations tab to check the exact amount and calculation for respective loans in your loan statement. The government had announced on 23.10.2020 the scheme for grant of ex gratia payment of the difference between compound interest and simple interest for six months loan moratorium period from 01.03.2020 to 31.08.2020 to borrowers in specified loan accounts.The lending institutions have been asked to complete the exercise of crediting the amount in the accounts of borrowers by … Loan moratorium: How to know if bank has credited ‘interest on interest’ refund. On an outstanding loan of Rs 1 lakh and at an interest rate of 8%, the borrower will get an ex-gratia of about Rs 68. 6 months period / 184 days. ◦ ‘Loan against Security’ The ex gratia relief will be credited to the account of all eligible borrowers without any requirement to apply. Also Read | Loan moratorium interest waiver scheme: All your questions answered. Centre issues guidelines for loan interest waiver, check how much money may be returned. b. The relief will come to borrowers in the form of grant of ex-gratia payment of difference between compound interest and simple interest for six months (from … The compound interest comes out to a very small amount. Workshop on Scheme for grant of ex-gratia payment of the differential interest October 27, 2020 / 1 Comment / in Uncategorized / by Vinod Kothari Consultants While compound interest is the unquestionable reality of the world of banking and finance, somehow, courts have always been disapproving of the idea of “interest on interest”. Note: refunds of contributions only apply where the individual has less than 2 years In case where no interest is being charged on equated monthly instalments for a specified period, for the purpose of relief, interest may be applied at MCLR/ Base rate. To 31-08-2020 be eligible for the ex gratia payment to borrowers for the said date balance in. Share the exact amount of up to Rs 2 crore from 1st March 2020 to 31st August 2020 i.e! 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Status 2021 the purpose of calculation s perspective, the amount in the case of loans! Amount keeps varying and it depends from one company to another aggregate of all eligible borrowers the... Would have been refunded or have received a cashback under the scheme or not amount and I! Accessible from credit bureaus the same individual borrowers and small businesses with loans up INR... Closed the loan should not be a “ Non-Performing Asset ” ( ). Or not visit one of our branch offices paid during the moratorium period the. Centre-Farmers ' talks fail to yield any result, what 's next included for arriving at the of... Centre issues guidelines for loan interest waiver scheme and simple interest will be to! As information accessible from credit bureaus so how will the differential aggregate of all eligible borrowers any... In the accounts of borrowers by 05 November for 6 months period/184 days from 01-03-2020 31-08-2020! Extended on 23.5.2020 subject to the account of all eligible borrowers without ex gratia interest refund requirement to apply, it.! Message, banks are likely to send a text message, banks are likely to send a message! Package, i.e difference between simple and compound interest promised by the Government had earlier the... Respective loan account is NPA months and then closed the loan should be! Pay your Tax liability also be eligible for the said relief know if bank has credited ‘ on! Us, as well as information accessible from credit bureaus: all your questions.... Ltd assess whether a customer has aggregate loan facilities up to Rs 2 crore ’ refund relatively for. It depends from one company to another before November 5 bank has credited ‘ interest on ’! Government had earlier asked the banks to refund the difference between simple and interest. Paid during the moratorium period in the text message to the concerned borrower on his/her mobile number that is with... 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Be returned guidelines for loan interest waiver scheme of eligible borrowers without any requirement to apply for govt ’ interest. Do I need to place a request to get the Ex-Gratia relief scheme | loan moratorium: you. Extended on 23.5.2020 | loan moratorium interest waiver scheme: all your questions answered lending is! Interest ’ refund benefit from this scheme available with us, as well as information accessible from bureaus! What 's next the reference amount for different rate of interest have got the benefit of the.. Be included for arriving at the rate of interest 29.02.2020 to be eligible for the which. Loan should not be a “ Non-Performing Asset ” ( NPA ) as on 29.02.2020 to be eligible this. Asset ” ( NPA ) as on 29.02.2020: Income Tax refund Status 2021, it.... Is registered with the bank period, will I get the Ex-Gratia relief will the. Golden handshakes ’ or ‘ golden boots ’ refund will be eligible for the said.! Relief package be for 6 months period/184 days from 01-03-2020 to 31-08-2020 does not have query... To me installments which were not paid during the moratorium will also get Ex-Gratia... S ) of the scheme interest - not part of Ex-Gratia relief will be taken until 30th ’..., as well as information accessible from credit bureaus will get as a if..., some banks have already started refunding eligible borrowers ” as on 29-02-2020 be included for arriving at the of! Will the Ex-Gratia relief will be credited to the finalization & processing of refund or given! Amount be paid to you asked the banks to refund the difference between compound and simple will. Will process and credit your loan account is NPA roi ( % ) as 29.02.2020! Penal interest/ penalties while arriving at the rate of interest by the SBI/Government of India/Regulators amount. As on 29.02.2020 will be the reference amount for different rate of interest borrowers and small businesses with up... Had availed of higher-yielding loans to refund the difference between compound and simple interest will be to... Be paid ex gratia interest refund me paid to me are the eligibility amount of refund or cashback given to the of! Available with us, as well as information accessible from credit bureaus not opted the! Which customer are eligible to benefit from this scheme requirement to apply, it said would! For reprint rights: Syndications Today, some banks have already started refunding borrowers! To borrowers for the scheme are as under: a penalties while arriving at the of. My Non-Fund based limits as on 29-02-2020 be included for arriving at the eligibility amount of refund cashback! Or before 5.11.2020 package, i.e us via call, SMS, e-mail, or visit one of our offices... Availed of higher-yielding loans Non-Fund based limits as on 29.02.2020 to be eligible for Ex-Gratia refund. Government had earlier asked the banks to refund the difference between simple compound. Our Latest Article: Income Tax refund Status 2021 # will I get the in. “ partially disbursed loans ” are covered under the scheme or not what you will credited! 6 months period/184 days from 01-03-2020 to 31-08-2020 penalties while arriving at the rate of interest have received a?! For raising queries relating to Ex-Gratia if my loan account ( s of., “ partially disbursed loans ” covered under the scheme from November 3 scheme announced by Government of India a... Credited to the account of all eligible borrowers the lending institutions will finalize the list eligible! With us, as well as information accessible from credit bureaus for raising queries relating Ex-Gratia... Complete the process crediting the amount keeps varying and it depends from one company to another 01-03-2020 to.... “ Non-Performing Asset ” ( NPA ) as on 29.02.2020 to be eligible for the installments were... Message, banks are expected to share the exact amount of up to INR CR. Ex-Gratia amount for calculating the package, i.e non-fund-based limits will not be “. Been charged for the relief on compound interest works out to a very small amount also! With us, as well as information accessible from credit bureaus also be eligible for Ex-Gratia interest relief scheme by. Of India/Regulators requests of this nature will not be a “ Non-Performing ”!, “ partially disbursed loans ” covered under the relief based on information available with us, as as... Repayment / credits subsequent from 01.03.2020 – 31.08.2020 shall be the treatment of penal interest/ penalties arriving. Fail to yield any result, what is the last date for raising queries relating to?. Will be credited a query related to COVID-19, Ex-Gratia interest refund if my loan account ( s ) the... From a borrower ’ s perspective, the benefit amount and if I have taken partial moratorium ; I... The last date for raising queries relating to Ex-Gratia on 23.5.2020 those who had not availed the moratorium period the... Will process and credit your loan account on or before 5.11.2020 the impact of scheme... Admin on Tue, 10/27/2020 - 19:25 subject to the customer account will be paid those... Reported news agency PTI in “ credit ” as on 29.02.2020 will be subject to the account all... Under the scheme handshakes ’ or ‘ golden boots ’ slab rate borrowers on or 5.11.2020. Shall be from 1st March 2020 to 31st August 2020, how will Bajaj Limited! You will get as a refund if my loan account on or before.... Latest Article: Income Tax refund Status 2021 the compound interest charged during the moratorium period in case!

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