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Loan moratorium: Centre asks banks to foot 'interest on interest' bill

Banks have been told that they can also adjust the amount against future liabilities for all accounts

banking sector
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Illustration by Binay Sinha

Nikunj Ohri New Delhi
The Union finance ministry has informally told banks to reimburse or adjust the compound interest they charged customers in line with the Sup­reme Court’s order asking them to refund “interest on interest” collected from acco­unts that sought a moratorium.
 
Banks have been told that they can also adjust the amount against future liabilities for all accounts, irrespective of whether they opted for the moratorium or not, similar to the scheme the government announced for loans up to Rs 2 crore, said an official aware of the development.
 
However, banks are thinking of making a representation to both the

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First Published: Apr 21 2021 | 12:27 AM IST

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