MSMEs may see another round of restructuring as RBI moratorium eases

Small businesses remain under stress as India ends lockdown to contain coronavirus outbreak

Micro small and medium enterprises (MSMEs) might need large-scale restructuring in August, when the moratorium on loan repayments will be lifted.

As the country opens up after a lockdown to contain the coronavirus, small businesses remain under stress.

“One-time restructuring might be needed after the moratorium is lifted. About 40-50 per cent of borrowers are availing the moratorium and the stress is likely to continue. Across the banking sector, small businesses have been seriously impacted and banks might have to make high provisions for them if restructuring is not done. This will seriously impact balance sheets of all banks,” said