RBI revises threshold for aggregate exposure limits of borrowing in Resolution Framework-2 for Covid-19 related stress of Individuals and Small Businesses.
RBI on 5th May 2021 issued Resolution Framework-2 for Covid-19 related stress of Individuals and Small Businesses. As per the Resolution Plan, lending institutions were permitted to offer a limited window to individual borrowers and small businesses to implement resolution plans in respect of their credit exposures while classifying the same as Standard upon implementation of the resolution plan subject to the conditions specified.
As per the Resolution Plan, the threshold exposure limit of loans and advances/ credit exposure for individuals and small businesses was up to Rs. 25 crore as on March 31, 2021.
However, RBI has made a revision in the threshold for aggregate exposure. After the revision, the following borrowers shall be eligible for the window of resolution to be invoked by the lending institutions
Revision in threshold of exposure limits in Resolution Framework-2 for Covid-19 stress of Individuals/Small Businesses
(i) Individuals who have availed of loans and advances for business purposes and to whom the lending institutions have aggregate exposure of not more than ₹25 crore as on March 31, 2021.
(ii) Small businesses, including those engaged in retail and wholesale trade, other than those classified as MSME as on March 31, 2021, and to whom the lending institutions have aggregate exposure of not more than ₹25 crore as on March 31, 2021.
Read RBI Circular for revision made Click Here >>
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