COVID-19
Loan Moratorium Calculator

Calculate how much extra interest you will pay if you opt for the COVID-19 term loan moratorium offered by banks/NBFCs for your personal loan, home loan, education loan, business loan etc. Please note - The calculator should not be used for your Credit Card bills. You are requested to contact your bank directly to find out the extra interest on your credit card dues, if you opt for the moratorium

Calculate the extra interest payable on opting for a moratorium

Click here to calculate your outstanding loan principal

Calculator Result

If you opt for the moratorium, the extra interest you would need to pay along with your outstanding EMIs is

1 Month

₹ 1,234

2 Months

₹ 1,234

3 Months

₹ 1,234

4 Months

₹ 1,234

5 Months

₹ 1,234

6 Months

₹ 1,234

Paisabazaar.com advises customers to opt for a moratorium only if their income and cash flows have been severely impacted and are unable to pay their EMIs.

Click here if you know your outstanding loan principal

Calculator Result

Your outstanding loan principal amount is ₹ 1,00,000

If you opt for the moratorium, the extra interest you would need to pay along with your outstanding EMIs is

1 Month

₹ 1,234

2 Months

₹ 1,234

3 Months

₹ 1,234

4 Months

₹ 1,234

5 Months

₹ 1,234

6 Months

₹ 1,234

Please note: The additional interest payable may vary slightly from the above results, depending on the due date of your EMI

Paisabazaar.com advises customers to opt for a moratorium only if their income and cash flows have been severely impacted and are unable to pay their EMIs.

How to Use the Loan Moratorium Calculator

The Loan Moratorium Calculator is an online tool that helps you determine the additional interest you need to pay if you opt for the COVID-19 loan moratorium benefit. In case you want to use the calculator you have to provide certain inputs and results will be calculated based on these. There are two possible ways you can use the calculator:

Option1. You know the principal outstanding and interest rate of your loan. You can find the principal outstanding on your latest loan statement while you interest rate is available in your loan agreement.  

Option2. You do not know your principal outstanding. In this case the COVID-19 loan moratorium calculator can help you calculate this based on your original loan amount, date of first instalment and loan tenure. You will also have to provide the interest rate of your loan in order to get the results.  

Mentioned below are the steps required to use the COVID -19 Loan Moratorium Calculator on Paisabazaar.com:

Option 1: If you know your outstanding principal and the interest rate of your personal loan.

Step 1: Enter you outstanding loan principal

Step 2: Now you are required to enter the rate of interest charged on your loan by bank/NBFC

Step 3: Click ‘Calculate’ to instantly get the extra interest payable for 1 month, 2 month and 3 month moratorium.

Option 2: If you do not know the outstanding loan principal amount.

Step 1: Enter your total loan amount i.e. the loan amount originally sanctioned

Step 2: Enter the original loan tenure (in years)

Step 3: Enter the rate of interest charged on your loan by the bank/NBFC

Step 4: Enter the starting date of your first EMI

Step 5: Click ‘Calculate’ to instantly know your outstanding principal amount as well as the extra interest payable if you opt for 1 month, 2 months, 3 months, 4 months, 5 months or 6 months of loan moratorium

Note: This calculator does not calculate the interest accrued for credit card moratorium. The interest accrued for loan moratorium may also differ slightly from the actual amount based on your EMI payment date.

What is Moratorium?

Moratorium is defined as a period where the borrower is not mandatorily required to make any EMI payments during the loan tenure. It is also referred as a “waiting period” or “holiday period” and it is only after this period that the borrower starts making fixed monthly payments i.e. EMI (equated monthly instalment payments) to pay off the loan.

The initial loan moratorium offered by the RBI in March 2020 authorized borrowers to postpone paying up to three EMIs with the due dates falling between 1st March, 2020 and 31st May, 2020 without any impact to their credit score.

On 22nd May 2020, RBI announced an additional extension of 3 months to the first moratorium ending on 31st May 2020. As a result, those opting for the extended moratorium can now defer their EMI payments due between 1st June 2020 and 31st August 2020. Similar to the original moratorium, interest will continue to accrue for the additional 3 month moratorium period too.

COVID-19 Loan Moratorium Options

As per current RBI regulation, the following are some key considerations with respect to the loan moratorium:

  • You can opt for the COVID-19 loan moratorium for any term loan such as personal loan, home loan, education loan, gold loan, etc. provided you meet the eligibility criteria set by the lender. Apart from term loans, this payment moratorium extends to credit card bill payments too.
  • The COVID-19 loan moratorium is optional i.e. you may choose not to opt for the loan moratorium and continue with your EMI payments as per the original schedule.
  • You can choose to take the complete 6 month moratorium or a shorter period such as 4months, 3 months, 2 months etc. You will however need to notify your lender regarding your choice as your accrued interest will vary accordingly.

Eligibility Criteria

Eligibility criteria to avail loan moratorium may vary slightly from one lender to another. However based on available information from major lenders, the following are the general eligibility criteria that a borrower needs to satisfy in order to be eligible for the COVID-19 loan moratorium:

  • The applicant needs to have outstanding loan with the bank/NBFC with EMI due dates falling between 1st March, 2020 and 31st May, 2020.
  • All the banks/NBFCs customers who have availed a personal loan before 1st March 2020.Pursuant to RBI announcement on 22nd May regarding 3 month loan moratorium extension, applicants can now also apply for EMI moratorium in case of due dates failing between 1st June 2020 and 31st August 2020.
  • All customers of banks/NBFCs who have availed a personal loan before 1st March 2020 have the option to apply for the facility
  • Individuals should have a minimum prior relationship of 6 months with the bank
  • The loan account should be in good standing with no default or missed payments before 1st March 2020. In case of some lenders this condition may be waived on a case by case basis depending on the bank’s criteria

How to Apply for Loan Moratorium

Borrowers are provided with two options to apply for loan moratorium i.e. Opt-in and Opt-out. Under Opt-in method, customers are required to voluntarily opt-in for the moratorium for payments falling due for the payment between the period beginning Mar 1, 2020 until May 1, 2020. With the RBI loan moratorium extension announcement this voluntary opt-in option is now available for EMI payments due between June 1, 2020 and August 31, 2020 as well.

Here are the key steps to apply for loan moratorium:

  • Visit the official website of concerned bank/NBFC
  • You will provided with an option of ‘Apply for Moratorium’ on the home page
  • Enter the details required
  • Follow the instructions and proceed further to apply for loan moratorium for the desired period

In case you want to opt out of the loan moratorium, the process to do so can be checked on your borrower’s official website.

Moratorium Calculation Example Using Formula

The following is the formula used by the loan moratorium calculator to calculate the extra interest accrued in case a borrower opts for the moratorium:

Monthly interest rate for loan = Annual Interest rate/12

Interest for 1st Month (A) = Loan Principal Outstanding x Monthly Interest Rate/100

Interest for 2nd Month (B) = (Loan Principal Outstanding + A) x Monthly Interest Rate/100

Interest for 3rd Month (C) = (Loan Principal Outstanding + A+B) x Monthly Interest Rate/100

Interest for 4th Month (D) = (Loan Principal Outstanding + A+B+C) x Monthly Interest Rate/100

Interest for 5th Month (E) = (Loan Principal Outstanding + A+B+C+D) x Monthly Interest Rate/100

Interest for 6th Month (F) = (Loan Principal Outstanding + A+B+C+D+E) x Monthly Interest Rate/100

Total moratorium interest for 6 months = A+B+C+D+E+F

Using the above formula, the following are the loan moratorium interest examples provided by the COVID-19 loan moratorium calculator*:

Principal Outstanding (Rs.) Interest Rate (%, p.a.) Extra Interest for 1 month moratorium (Rs.) Extra Interest for 2 months moratorium (Rs.) Extra Interest for 3 months moratorium (Rs.) Extra Interest for 4 months moratorium (Rs.) Extra Interest for 5 months moratorium (Rs.) Extra Interest for 6 months moratorium (Rs.)
20 lakh 8.5 14,167 28,434 42,802 57,272 71,844 86,519
2 lakh 18 3,000 6,045 9,136 12,273 15,457 18,689
4 lakh 12 4,000 8,040 12,120 16,242 20,404 24,608
30 lakh 8 20,000 40,133 60,401 80,804 101,342 122,018
8 lakh 15 10,000 20,125 30,377 40,756 51,266 61,907

*The calculations are for illustrative purposes only and actual interest accrued may vary slightly based on the EMI payment due date.

List of Banks Providing Loan Moratorium

As per the RBI directives, all banks/NBFCs are allowed to provide loan moratorium to their borrowers who voluntarily want to opt for it. Some of the top banks and NBFCs that are currently offering the loan moratorium option include the following:

Pros & Cons of opting for Loan Moratorium

The key benefit of the loan moratorium is that your credit score will remain unaffected and no late payment charges/penal interest will be levied even though you do not make any EMI payments during the moratorium period. This ensures that in case you have a cash crunch during the COVID-19 lock down period, you can still maintain adequate liquidity without long term adverse impact to your credit history or score. There are however a few cons if you opt for the moratorium:

  • Additional interest accrued during moratorium. This will either increase your individual EMI pay out to a certain extent or if EMI payouts are kept unchanged, your loan tenure will be extended
  • The loan account closure date will be extended depending on how long a moratorium you have opted for. So if you opt for 1 month moratorium, your loan account closure date will move back by 1 month, for 2 month moratorium, it will be 2 months and so on for up to 6 months (in case you opt for the entire 6 month moratorium period)

In view of these, it is advisable that you keep making your scheduled EMI payments instead of opting for the loan moratorium unless you are faced with a severe cash crunch which has made it impossible for you to make the scheduled monthly payments.  

FAQs

Q1. What happens if one opts for a loan Moratorium?

The current COVID-19 moratorium is an option provided to current borrowers to not make payments towards their loan/ credit card dues for 3 months starting 1st Mar 2020 and ending 31st May 2020. While there will be no late payment charges or penalties if you do not make any payments by opting for the moratorium, interest will accrue for the entire period. In addition, this would not adversely affect your credit score or credit history. With the RBI announcing the 3 month moratorium extension for the 1st June to 31st August, 2020 period, the same benefits as at the time of the original moratorium will apply if you opt for an extension of the moratorium. However, do remember interest will continue to accrue for the entire period of the moratorium up to 6 months in total.

Q2. Will EMIs be waived off if i opt for Loan moratorium?

No, your EMIs will not be waived off you opt for loan moratorium. They will only be deferred till the end of the moratorium period (up to 6 months including extension) after which you will be required to continue making your scheduled payments along with accrued moratorium interest payments.

Q3. Are there any extra charges for opting it?

No, there is no additional charge for availing loan moratorium. However, additional interest will continue to accrue during the moratorium period which will be payable over the remainder of the loan tenure.

Q4. What are the products this moratorium covers?

The COVID-19 moratorium option covers all term loans such as personal loan, home loan, business loan, gold loan, car loan etc. as well as credit card dues.

Q5. Is Paisabazaar’s Loan Moratorium Calculator free of cost?

Yes the Paisabazaar COVID-19 loan moratorium calculator is available to you absolutely free. You can use this calculator to know the loan moratorium interest pay out any number of times and any time of the day.

Q6. Will I pay anything during the moratorium period?

No. If you have opted for the loan moratorium you will not have to pay anything during the period of moratorium you have opted for.

Q7. Can I opt for only 1 month or 2 month moratorium instead of all 6 months of the extended period?

Most lenders are currently offering the option to choose a suitable moratorium period ranging from minimum 1 month to maximum 6 months. You should confirm how to apply for a shorter than the currently available 6 month moratorium period with your lender.

Q8. How is the moratorium interest calculated?

The moratorium interest is calculated based on the monthly nominal interest rate applicable to your current loan. For example, the monthly nominal interest rate for a 12% p.a. loan will be 12/12 = 1%. Subsequently, Interest for the 1st month (A) = Principal outstanding x Monthly rate/100. Subsequently, interest for the 2nd month (B) = (Principal Outstanding + A) x Monthly rate/100

Then interest for 3rd month (C) = (Principal outstanding + A + B) x Monthly Rate/100.

Subsequently, interest for the 4th month (D) = (Principal Outstanding + A+B+C) x Monthly rate/100

Subsequently, interest for the 5th month (E) = (Principal Outstanding + A+B+C+D) x Monthly rate/100

And finally, interest for the 6th month (F) = (Principal Outstanding + A+B+C+D+E) x Monthly rate/100

Total interest accrued for moratorium period of 6 months = A+B+C+D+E+F

Q9. What does the RBI moratorium extension announced in May mean?

Subsequent to the RBI moratorium extension announcement in May, those opting for the benefit can now defer their EMI payments due between 1st June 2020 and 31st August 2020. There will be no additional charges or impact on credit score during this 3 month additional loan moratorium period, however, interest will continue to accrue on the outstanding loan principal at the applicable rate. This option to avail the extended 3 month loan moratorium is available to all existing borrowers who are eligible as per the criteria specified by their respective lender.

Q10. Will my bank be offering the extended moratorium period to me?

Yes, if you qualify for the loan moratorium as per the guidelines of the lender you can opt for the extended moratorium announced by RBI for EMIs payable between 1st June 2020 and 31st August 2020 period.