1. What is the restructuring scheme approved by RBI?
RBI has provided a framework to banks & lending institutions for implementation of resolution plans for addressing the economic fallout due to the COVID-19 pandemic which has led to significant financial stress for customers. Basis the framework and regulatory guidelines, AU Small Finance Bank has framed its policy for the restructuring of the loan/s of individuals and entities that have been impacted due to the COVID-19 pandemic.
2. Who are eligible for restructuring?
Borrower accounts that are classified as standard, but not in default for more than 30 days with the bank as on March 1, 2020 and continue to remain as standard across its loans/facilities till date are eligible for restructuring.
3. How do I can apply for restructuring of the credit facilities?
You can submit request on AU Bank website, visit the nearest AU Bank Branch or contact your relationship manager for details.
4. What are the restructuring options that are available?
Rescheduling of payments
Moratorium for maximum up to 2 years
Extension of loan tenure up to maximum of 2 years
Interest accrued or to be accrued can be converted into another credit facility or total outstanding can
be rescheduled in single loan
5. Will opting for the restructuring have an impact on my credit bureau report?
As per regulatory guidelines, your loan/credit facility will be reported to the credit bureau as "Restructured".
6. Will there be any processing fees or charges if I restructure my loan?
Yes, we will levy upfront processing fee/charge.
7. I am self-employed individual/business enterprises. Whether I am eligible for restructuring?
8. What type of borrower's are not eligible for restructuring (Resolution framework due to Covid19)?
MSME borrowers whose aggregate exposure to lending institutions collectively, is Rs.25 crore or less as on March 1, 2020.
Farm credit as listed in Paragraph 6.1 of Master Direction FIDD.CO.Plan.1/04.09.01/2016-17 dated July 7, 2016 (as updated) or other relevant instructions as applicable to specific category of lending institutions.
Loans to Primary Agricultural Credit Societies (PACS), Farmers' Service Societies (FSS) and Large-sized Adivasi Multi-Purpose Societies (LAMPS) for on-lending to agriculture
Exposures of Bank to financial service providers. Financial service providers shall have the same meaning as in sub-section (17) of Section 3 of the Insolvency and Bankruptcy Act, 2016.
Exposures of Bank to Central and State Governments; Local Government bodies (e.g. . Municipal Corporations); and body corporates established by an Act of Parliament or State Legislature.
Exposures of housing finance companies where the account has been rescheduled in terms of para 2(1)(zc)(ii) of the Master Circular - The Housing Finance Companies (NHB) Directions, 2010 after March 1, 2020, unless a resolution plan under this framework has been invoked by other lending institutions
However, from the date of this circular, any resolution necessitated on account of the economic fallout of Covid-19 pandemic, shall be undertaken only under this framework.
9. I am having loan along with co-borrowers/guarantors. Will all the co-borrowers/guarantors of the original loan agreement be required to sign the revised restructuring agreement?
As per regulatory and legal requirements, signature of all borrowers/co-borrowers/guarantors of the original loan is required on restructuring agreement/documents.
10. I have taken loan from the Bank after 1st March 2020 and adversely affected due to Covid-19 pandemic. Whether I am eligible for the resolution?
No, Loans availed on or before 01.03.2020, are only eligible for resolution under this Framework.
11. I have availed moratorium given by the Bank under regulatory package in the month of March 2020 and June 2020, whether I can avail benefits under this Resolution Framework?
Yes, you can avail benefit under this Resolution Framework
12. By what date, we can apply for benefit under this scheme?
As per extant regulations, the resolution plan should be sanctioned maximum by 31.12.2020
13. If the borrower has applied for restructuring, can it be considered as having been accepted and implemented by the Bank?
No. The application for restructuring of credit facility does not guarantee its acceptance. Once the borrower applies for restructuring of credit facility, the Bank will review the application on the basis of its internal policies. Thereafter, the Bank will communicate the status of the application.
14. Can a borrower apply for restructuring of partial outstanding of his/her total outstanding towards a credit facility?
No, restructuring of partial outstanding is not permitted.
15. A borrower against whom Bank has initiated legal recourse for recovery of dues (including under the SARFAESI Act) be eligible for restructuring?
No, these borrowers are not eligible for restructuring of their credit facilities.
16. Whether MSME borrowers having aggregate exposure of Rs.25 crore or less are eligible for restructuring under the Resolution Framework?
No, MSME borrowers with total exposure of Rs.25 crore or less across lending institutions cannot apply under this resolution programme.
They can apply for relief under the RBI’s MSME restructuring scheme as per notification dated January 01, 2019 (as may be updated, modified, and extended from time to time).
17. I am having Home Loan and Car loan facility with the Bank; can I avail benefit in both the accounts?
Yes, you may avail benefit under resolution framework in all loan accounts with the bank, subject to your eligibility.
In case of further queries:
Please contact nearest branch/ your relationship manager