The court said that any amount collected as compound interest shall be adjusted to the next installment payable instead of refunding it to the borrower
The court rejected the pleas from various trade associations and corporate bodies to extend the loan moratorium period
Digital lenders and new-age credit platforms may now have to forgo a chunk of the expected income from interest on interest for the loans under moratorium
In a ruling that could complicate the financial performance of India’s digital lenders and credit ecosystem, the Supreme Court today (March 23, 2021), called for a waiver of the interest on interest for loans under the Reserve Bank of India (RBI) moratorium last year. However, the court rejected the pleas from various trade associations and corporate bodies to extend the loan moratorium period, adding that a complete waiver of interest could not be granted.
The SC noted that it could not allow additional relief such as total waiver of interest or an extension of…