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The 2nd Covid-19 wave saw many borrowers facing financial crunch. To help borrowers meet their financial exigencies, RBI brought forth Resolution Framework 2.0, to be mandated by lenders including banks and financial institutions, on 5 May, 2021. 

The resurgence of the COVID-19 pandemic led to RBI announcing the Resolution Framework 2.0 on May 5, 2021 for helping small businesses, MSMEs and individual borrowers to tide over their financial concerns.

Magma Fincorp Limited was incorporated in 1988 and started its operations in 1989. It is headquartered in Kolkata and is registered with the Reserve Bank of India. Today, the company offers services across 21 states via its 154 offices.

According to RBI guidelines, the loan moratorium was applicable up to August 2020. Therefore, if you have availed a loan from Magma Fincorp, the EMI moratorium for Covid-19 ended in 2020 itself and is no longer applicable. 

Here is the eligibility criteria for the one-time loan restructuring offered by the RBI due to the Covid-19 pandemic

When it comes to the interest charged on credit card dues, as per the moratorium relief, if you don’t pay your credit card bills within the moratorium period, your bank will levy interest as it normally does and keeps accruing. But they wouldn’t levy late payment fees and the cumulative interest levied can go up to 12%. And if you make further purchases during the moratorium period, the interest on the additional spends will also start accruing and you might end up paying a huge amount on interest.

This EMI moratorium was mainly introduced to benefit people who wouldn’t have a regular cash flow during the covid-19 crisis. This 6 month moratorium would definitely help daily wage workers and salaried individuals who might not be able to make their EMI payments due to pay cuts or layoffs. You can accordingly decide whether you want to take up the EMI holiday or not, according to your financial situation. 

The moratorium is not a waiver but just a postponement of EMI loan payments and also for credit card outstanding dues. The moratorium is for both the principal amount of and the interest. Even though payments are postponed to a later date, the interest will continue to accrue on your dues during the moratorium period. And the interest due will be added to the outstanding amount pending, which will have to be paid along with the principal amount. 

Applying for the EMI moratorium differs from bank to bank. Ever since the RBI has announced the moratorium, banks have made sure that their customers are informed on what is to be done to apply for the moratorium. And all the information on how to avail the moratorium can be checked on each bank's official websites. The most commonly followed way for letting customers opt for the EMI holiday is by sharing links through SMSs or emails.

As there are people facing issues with paying their loan EMIs due to the coronavirus pandemic, the Reserve Bank of India has allowed banks and other financial institutions to provide a 6 month EMI holiday. The EMI holiday is included for all loans including home loan, credit card dues, personal loan, education loan,working capital loans, auto loans, etc. As this is just a postponement of EMI payments, interest will also not be waived off and will continue to be added on the outstanding amount.

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