Implementation of restructured MSME debt till March 31

August 06, 2020 - India

The Reserve Bank of India (RBI) has extended the date for implementation of restructuring of MSME debt to March 31, 2021, from the previous December 31, 2020. The scheme offering debt restructuring is in place for MSMEs that were in default but 'standard' as on January 1, 2020. The scheme has provided relief to a large number of MSMEs, RBI said today.

"However, the stress in the MSME sector has got accentuated on account of the fallout of COVID-19. Recognising the need for continued support to MSMEs’ meaningful restructuring, it has been decided that, in respect of MSME borrowers facing stress on account of the economic fallout of the pandemic, lending institutions may restructure the debt under the existing framework, provided the borrower’s account was classified as standard with the lender as on March 1, 2020. This restructuring shall be implemented by March 31, 2021," RBI said in a press release.