As per the guidelines proposed by the Reserve Bank of India amid the coronavirus outbreak related countrywide lockdown, banks and financial institutions have been told to allow the deferment of installments for any loans including personal loan dues payable between March 1, 2020 and May 31, 2020. This was further extended for a 3 month period from June 1, 2020 to August 31, 2020. Following these directives, Axis Bank has provided a moratorium of up to 6 months on personal loan EMI payments due between March 1, 2020 and August 31, 2020. Here are the details of moratorium guidelines on all the term loans, including Axis Bank Personal Loan.
COVID-19 Relief Measures from Axis Bank
Availing relief measures from Axis Bank on loan EMIs is completely voluntary. Mentioned below are some of the key relief measures existing borrowers can avail under COVID-19 EMI Moratorium on Axis Bank personal loan:
- Bank does not ask for personal loan EMI payment till 31st August, 2020
- Your credit score will not get affected due to delayed payments if you opt for the loan moratorium
- The personal loan tenure would also get extended by the corresponding period for which you have availed the moratorium i.e. if you opt for 2 months’ moratorium on EMIs, your loan tenure will be extended by 2 months
Eligibility for Axis Bank Personal Loan Moratorium
Following are the eligibility criteria for Axis Bank Personal Loan Moratorium:
- All the Axis Bank customers who have availed a personal loan before 1st March 2020 have the option to apply for the facility
- Customers who have outstanding payments prior to 1st March 2020 are also eligible for loan moratorium as per the discretion of the bank (i.e. on a case by case basis)
- Customers who have opted for the initial 3 month moratorium that ended in May are also eligible to apply for the additional 3 month extension as per RBI directive
The following example will illustrate how your extra interest payment will be if you opt for an Axis Bank personal loan moratorium. Suppose you have an outstanding loan of Rs. 7 lakh at 16% p.a. interest rate with an outstanding tenure of 3 years at the time of the loan moratorium:
Case 1. If you do not opt for the moratorium:
|Total interest payable for 3 year loan tenure||Rs. 1.86 lakh|
|Total amount to be repaid (Principal Outstanding + Interest)||Rs. 8.86 lakh|
Case 2. If you do opt for the moratorium:
|Extra interest incurred during the moratorium period of 3 months*||Rs. 28375|
|Interest payable over the remainder of the loan tenure (3 years)**||Rs. 1.86 lakh|
|Total amount to be repaid (Principal + Interest as per original loan tenure + 3 month moratorium period interest)||Rs. 9.14 lakh|
Note: * Extra interest incurred during the moratorium period of 3 months = 9333 (Month 1 interest) + 9457 (Month 2 interest) + 9583 (Month 3 interest) = Rs. 28,375.
** As your loan tenure will be extended by 3 months as a result of the moratorium you still have to pay the interest incurred for the original 3 year tenure remaining on the loan = Rs. 1.86 Lakh.
***Please note that the above example is for illustrative purposes only and actual values/calculation method may vary from lender to lender.
Thus in the above case you have to pay an additional Rs. 28,375 in interest charges just for taking the 3 month moratorium on your Axis Bank personal loan. This extra interest payable is dependent on your loan principal as well as interest rate hence it will be greater if your loan amount and/or interest rate are higher than our illustration. In short by opting for this loan moratorium, you may increase your overall cost of borrowing significantly.
How to apply for Axis Bank Personal Loan Moratorium
Below given are the steps required to apply for Axis Bank Personal Loan Moratorium:
Step 1: Visit the Axis Bank Consent for Moratorium page as shown below. And enter your registered mobile number as per bank records (with country code as shown in the example) as well as the captcha code:
Step 2: On the subsequent page, enter the OTP (one time password) sent to your mobile
Step 4: Now you will be required to select the product and customer ID (if you have multiple). Then you can submit a moratorium request for the chosen loan/credit card account.
Some Important Related Terms
a). Standing Instructions
A standing instruction (SI) is provided by an account holder to the bank with instructions to automatically deduct a pre-determined amount periodically to pay loan EMIs, credit card dues, etc. It is also known as banker’s order.
National Automated Clearing House or NACH is a web-based centralised clearing service platform used by banks and financial institutions. It aims to provide interbank high and low volume transactions that are repetitive and periodic in nature.
Q1. Is the relief available for Axis Bank credit card dues also?
As per RBI guidelines, Axis Bank has provided COVID-19 relief measures for not just loans but also for Axis Bank credit cards.
Q2. Does not paying EMI during moratorium affect my CIBIL Score?
No. Your CIBIL score won’t get affected under COVID-19 outbreak. However, the bank will report to credit information companies (CICs) the fact that you have availed the moratorium.
Q3. What should I do if I do not wish to opt for EMI Moratorium?
If you do not wish to opt for EMI Moratorium you don’t have to do anything and keep paying your EMIs and other dues as per the schedule.
Q4. I have a personal loan and a home loan from HDFC Bank. Is it possible to get EMI Moratorium on both the loans?
Yes, you can avail EMI Moratorium for both the loans. However, it is important to note that that additional interest for the EMI moratorium period will be applicable on both these loans separately.
Q5. Can I apply for Axis Bank Personal Loan Moratorium online?
Yes, you can apply for online by following the steps mentioned in the earlier section. Do keep your mobile phone handy for the same.
Q6. Can I opt for only 1 month moratorium on EMI instead of 6 months?
Yes. You can opt for only 1 month moratorium instead of 6 months as per your discretion and extra interest will be applicable only for the chosen period.
Q7. How does the moratorium impact my current loan tenure?
If you opt for Axis Bank loan moratorium, your loan tenure will be extended by the extent of moratorium chosen. For example if you choose to take a one month moratorium and your Axis Bank personal loan was originally supposed to end in December 2020, the loan will now end in January 2020.
Q8. Will there be any cheque/SI bounce charges if I opt for the moratorium?
No. If you opt for moratorium, there will be no SI/cheque bounce charges for non-repayment during the moratorium duration.
Q9. Should I opt for the moratorium?
It is recommended that you decide based on your unique situation and only if you have financial difficulties due to the lockdown. Also read: Should you opt for the moratorium on personal loans?
Q10. What are the different types of borrowings that are covered under the Axis Bank COVID Relief Package?
The following are the different types of borrowings covered by the Axis Bank COVID Relief Package:
- Retail Term loans including Personal loans and Gold Loans
- Retail Credit Cards
- Kisan Credit Card (KCC) loans and Farmer Loans (Cash Credit, Overdraft and Term Loan)
- Microfinance loans (extended by the bank and BC partners)
- Commodity Loans
- Tractor Loans
- Commercial Vehicle Loans
- Two Wheeler Loans
- Construction Equipment Loans
- Business Loans
- Unsecured overdraft and term loans(Small Business Banking)
The EMI/payment moratorium is applicable to all the above products. Additional products may also be included as per RBI directive and discretion of Axis Bank.