RAI requests RBI to implement a three-month moratorium on loans
Parul April 1, 2020
MORE IN News
According to news reports, Retailers Association of India (RAI) has requested RBI for direction to all banks for implementation of the moratorium with regards to the recent announcement allowing all commercial banks (including regional rural banks, small finance banks, and local area banks), co-operative banks, Financial Institutions, and NBFCs (including housing finance companies) in the country to provide a three-month moratorium on all term loans (including agricultural term loans, retail and crop loans), to help millions of people with bank dues during the novel coronavirus pandemic.
In fact, the Retailers Association of India (RAI) has commended the Reserve Bank of India for stepping in at the right time to bring some relief to the mounting stress on the economy and retail business in the wake of COVID-19. However, banks are not willing to take any action on this front.
The Retailers Association of India (RAI) has formally written to Shri Shaktikanta Das, Honorable Governor, Reserve Bank of India to seek urgent intervention in this matter by issuing a firm and clear directive to all banks for implementing the moratorium.
As most stores are shut, retailers have zero revenue. They still have to pay overheads such as salaries, electricity, and rentals. The cash inflow of the industry has come to a standstill, while the fixed operating costs remain intact. With this background, the moratorium is likely to provide some relief.
The Retailers Association of India (RAI) is the apex body of Retailers in India, representing around 13667 member establishments, including large and small retailers in the country, having 500,000 stores providing Direct and Indirect employment to 43 million Indians.