HDFC Bank loan restructuring scheme: Eligibility to processing fee; key points you need to know

After State Bank of India (SBI), HDFC Bank has stipulated a minimum outstanding balance of Rs 25,000 to consider the credit card or loan outstanding for restructuring under the scheme approved by the Reserve Bank of India (RBI). Bank also offered an extension of loan tenures by up to two years to provide relief to its retail and corporate customers hit by the covid-19 pandemic. The private lender will levy a processing fee to restructure the loan.

In March 2020, the Reserve Bank of India (RBI) allowed a moratorium of three months on payment of instalments of loans and later extended it by three months till 31 August 2020.

Bank said it may levy a fee if the borrower chooses to restructure the loan. “The customer has to be impacted financially by the Covid-19 pandemic in the form of reduction/ loss of income or cash flows,” the bank said.

“The bank will assess the viability of the customer to pay the restructured EMIs basis the documents provided, before granting the restructuring. Apart from the viability calculations, the repayment track record of the customer, and the responses given by the customer while availing moratorium earlier will also be factored in the restructuring decision,” it said.

HDFC Bank has released its policy for the restructuring of the loans of individuals and entities that have been impacted due to the COVID-19 pandemic.

As per the regulatory guidelines, loan/credit facility will be reported to the credit bureau as “Restructured”, the bank said.

“As per the guidelines, restructuring has to be reported at a borrower level to the credit bureaus and hence all the facilities/loans of the borrower with the bank will be classified and reported as “Restructured” even if the borrower has taken restructuring for only one loan,” the bank added.

As per regulatory and legal requirements, all borrowers/co-borrowers of the original loan need to agree and sign on any changes in the loan structure, including the restructuring agreement, the HDFC Bank FAQs said.

Who can apply for restructuring now as was not able to apply for moratorium before

The scheme for restructuring is open to all customers of the bank irrespective of the moratorium applied status subject to the borrower meeting the regulatory guidelines of restructuring.

Are self-employed or entity eligible for relief?

Self-employed individuals or entities falling under the MSME category as per the revised guidelines for MSME classification rolled out by the Government of India, can apply for relief under the MSME restructuring scheme. Please contact your RM for more details. The Bank would request its self-employed customers to register themselves as MSME through the Udyam portal of the Government wherever applicable.

Udyam portal link: https://udyamregistration.gov.in/Government-of-India/Ministry-of-MSME/on...