Restructuring of retail loans: Here's how SBI customers can opt for recast

SBI has around 49 crore customers. At the end of June around, 10% of its loan book was under moratorium, down from 21.8% in May. Around 90 lakh retail customers availed the moratorium.

New Delhi: The country's biggest lender State Bank of India will launch a digital platform that will enable its retail borrowers to submit their loan restructuting request. Borrowers can check their eligibility for loan recast on the basis of present and expected incomes. The portal will likely be in place by September 24, the Economic Times mentioned in a report.

Worth mentioning here is that retail borrowers can avail an additional moratorium of six months to two years as per the Reserve Bank of India's guidelines. The portal will suggest its customers the time period for which he is eligible for an additional moratorium. However, its corporate and MSME customers have to visit their respective branches for availing loan recast.

“We have 3 million housing loan customers; if anyone wants to check eligibility, it will be a total system driven automated process; we can’t do this process manually,” the publication quoted Rajnish Kumar, chairman, SBI as saying. “The system will check your current income and expected income in the next few months and basis that, it will suggest moratoriums of 12 months or two years for the customer. We are planning to roll this out by September 22-24.”

SBI has around 49 crore customers. At the end of June around 10% of its loan book was under moratorium, down from 21.8% in May. Around 90 lakh retail customers availed the moratorium amounting to Rs 6.5 lakh crore. Analysts say a bulk of these 90 lakh retail borrowers are likely to avail loan recast. However, Kumar is of a different opinion. 

“As per the current payment trend I don’t see a huge demand for restructuring; we have not received a single restructuring request from the corporate side so far, but I guess since the Kamath Committee contours only came last week, the companies may be assessing their eligibility,” Kumar told the business daily.

The publication citing SBI insiders mentioned that around 9% of its retail borrowers under moratorium could opt for recast of their loans. The bank has a retail loan portfolio of Rs 7.5 lakh crore, out of which Rs 4.55 lakh crore is home loans and over Rs 1.45 lakh crore is personal loans.