Stress Resolution Framework 2.0 for Individuals, Small Businesses and MSMEs

Stress Resolution Framework 2.0 for Individuals, Small Businesses and MSMEs

Part of: GS Prelims and GS – III – Economy 

In news

• RBI has announced following set of measures to relieve stress faced by most vulnerable categories of borrowers – individuals, borrowers and MSMEs.

Key takeaways 

• Individuals, borrowers and MSMEs with aggregate exposure up to Rs. 25 crore, who have not availed restructuring under any previous frameworks, but classified as standard on 31 March, 2021, will be eligible to be considered under Resolution Framework 2.0.
• This can be invoked till September 30, 2021 and will have to be implemented within 90 days after invocation.
• For individuals and small businesses who have availed restructuring of loans under Resolution Framework 1.0, where moratorium of less than 2 years was permitted, lending institutions can now increase the period and/or extend residual tenure up to a total period of 2 years.
• In respect of small businesses and MSMEs restructured earlier, lending institutions are now permitted to review working capital sanction limits, as a one-time measure.