The Reserve Bank of India (RBI) has laid down certain broad principles for lenders relating to their participation in Government Debt Relief Scheme (DRS), including sacrifice of interest and/or prinicpal and loan account status.
This comes in the backdrop of States announcing DRS to provide relief to borrowers such as farmers during natural calamities or political parties promising the same for a targeted segment of borrowers in the run up to elections.
The central bank also shared a model operating procedure (MOP) relating to Government DRS with the State Governments. This includes pre-notification consultation with the State Level Bankers’ Committee (SLBC)/ District level Consultative Committee (DCC), funding and design of the…
