Banks and non-bank lenders could restructure up to Rs 10,000 crore in loans to micro, small and medium enterprises without classifying them as bad debt, according to an estimate by rating agency ICRA. This, after the Reserve Bank of India gave in to demands for easier loan restructuring terms for small business.
The one-time restructuring scheme announced on Tuesday allows for loan terms such as interest rates and tenures to be revised without a change in asset classification from standard to non-performing. Known as regulatory forbearance in industry parlance, such restructuring was widely misused for evergreening of bad corporate loans in the 2011-13 period.
The benefits were withdrawn for large corporate loans in 2015 but have now bee…
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