Skip to main content

Directions on Trade Relief Measures

Reserve Bank of India (RBI) has issued directions on trade relief measures in respect to credit facilities extended by regulated entities.

To whom shall the directions be applicable?

The directions shall be applicable to the following Regulated Entities (REs) –

  • Commercial Banks
  • Primary (Urban) Co-operative Banks, State Co-operative Banks and Central Co-operative Banks
  • Non-Banking Financial Companies (including Housing Finance Companies)
  • All-India Financial Institutions
  • Credit Information Companies

What are the eligibility criteria for the trade relief?

  • RE shall satisfy itself that the borrower’s business is impacted by trade disruptions caused by global headwinds.
  • For the purpose of considering relief, a borrower shall be deemed to be eligible upon fulfilment of all of the following conditions –
    • The borrower is engaged in exports relating to any of the sectors specified in the directions.
    • The borrower had an outstanding export credit facility from a RE as of August 31, 2025.
    • The accounts of the borrower with all REs were classified as ‘Standard’ as on August 31, 2025.
  • REs other than those which have sanctioned the export credit facility to the borrower may satisfy themselves that the borrower qualifies under the above criteria, basis a certification to be obtained from the REs which have extended export credit to the borrower.

What relief measures may be extended by REs?

  • Moratorium / Deferment – 
    • In respect of all term loans, a RE may grant a moratorium on payment of all instalments (principal and / or interest) falling due between September 1, 2025 and December 31, 2025 (i.e. effective period).
    • In respect of working capital facilities sanctioned in the form of cash credit / overdraft, a RE may defer the recovery of interest applied in respect of all such facilities during the effective period.
    • During the moratorium / deferment period, interest shall continue to accrue. However, interest application shall be on simple interest basis, without compounding effect, i.e., there shall be no interest on interest.
    • The accumulated accrued interest during moratorium / deferment period may be converted into a funded interest term loan which shall be repayable in one or more instalments after March 31, 2026, but not later than September 30, 2026.
    • In respect of working capital facilities, a RE may, at its discretion, recalculate ‘drawing power’ by reducing the margins and / or reassess the working capital limits, during the effective period. 
  • Extension of tenor for Export Credit – 
    • RE eligible to undertake export financing business may permit an enhanced credit period of up to 450 days for pre-shipment and post-shipment export credit disbursed till March 31, 2026.
    • In respect of packing credit facilities already availed by exporters on or before August 31, 2025, where dispatch of goods could not take place, a RE may allow liquidation of such facilities from any legitimate alternate sources, including domestic sale proceeds of such goods or substitution of contract with proceeds of another export order.

What are the directions on asset classification and provisioning?

  • The moratorium period / deferment shall be excluded by the RE while calculating the number of days past-due for the purpose of asset classification.
  • Grant of moratorium / deferment of instalments and recalculation of the ‘drawing power’ shall not be treated as an event of restructuring. Consequently, such a measure, by itself, shall not result in asset classification downgrade.
  • REs shall report to the Credit Information Companies (CICs) as per the extant instructions, duly taking into account the above provisions.
  • In respect of eligible borrower accounts which were in default but classified as ‘standard’ as on August 31, 2025, and where relief measures have been extended, a RE shall make a general provision of atleast 5% of the total outstanding in such accounts, by December 31, 2025.
  • The above general provision may be adjusted against the actual specific provisioning requirements for slippages from these borrower accounts. Any residual general provisions at the end of the financial year 2025-26 shall be either written back or adjusted against the provisions required for all other borrower accounts by June 30, 2026.
  • The above general provisions shall not be reckoned for arriving at net NPAs till they are adjusted against the actual provisioning requirements. Further, till such adjustments, these provisions shall not be netted from gross advances but shown separately in the balance sheet as appropriate.


References

Reserve Bank of India. (2025, November 14). 'Reserve Bank of India (Trade Relief Measures) Directions, 2025'. Retrieved from https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12921&Mode=0


Follow at - Telegram   Instagram   LinkedIn   X   Facebook

Labels:

Comments

Post a Comment

Popular Posts

Modified Interest Subvention Scheme for Agricultural Loans

Reserve Bank of India (RBI) has published the modified interest subvention scheme (MISS) for short term loans for agriculture and allied activities availed through Kisan Credit Card (KCC) during the financial year 2025-26. Which loans are covered under modified interest subvention scheme (MISS)? The short-term crop loans and short-term loans for allied activities including animal husbandry, dairy, fisheries, bee keeping etc. up to an overall limit of ₹3 lakh to farmers through KCC during the year 2025-26 will be covered for interest subvention. Which lending institutions are covered under MISS? The MISS is applicable to the lending institutions viz. Public Sector Banks (PSBs) and Private Sector Banks (in respect of loans given by their rural and semi-urban branches only), Small Finance Banks (SFBs) and computerized Primary Agriculture Cooperative Societies (PACS) ceded with Scheduled Commercial Banks (SCBs), on use of their own resources.  How much is the interest subvention? The a...
Post a Comment
Read more

Reserve Bank - Integrated Ombudsman Scheme, 2026 (RB-IOS, 2026)

Reserve Bank of India (RBI) has issued Reserve Bank - Integrated Ombudsman Scheme, 2026. Who is RBI Ombudsman and RBI Deputy Ombudsman? RBI may appoint one or more of its officers as RBI Ombudsman and RBI Deputy Ombudsman, to carry out the functions entrusted to them under the Reserve Bank - Integrated Ombudsman Scheme (RB-IOS).  The appointment of RBI Ombudsman or RBI Deputy Ombudsman shall be for up to 3 years at a time. RBI Ombudsman shall have the power to examine and close all complaints.   RBI Deputy Ombudsman shall have the power to close those complaints falling under clause 10 of the RB-IOS (i.e. non-maintainable complaints) and complaints resolved as per the provisions of the clause 14(8)(a) to 14(8)(c) of the RB-IOS (i.e. complaint resolved / withdrawn). Which entities are covered under the RB-IOS? RB-IOS shall be applicable to the following Regulated Entities (REs) – Commercial Banks Regional Rural Banks  State Co-operative Banks Central Co-operative Bank...
Post a Comment
Read more

Internal Ombudsman for Regulated Entities (Banks, NBFCs, PPI Issuers and CICs)

Reserve Bank of India (RBI) has issued directions on Internal Ombudsman for regulated entities. To whom shall the directions on Internal Ombudsman (IO) be applicable? The directions on IO shall be applicable to the following Regulated Entities (REs) – Commercial Banks (other than Small Finance Banks, Payment Banks, and Local Area Banks) having 10 or more banking outlets in India as on March 31, 2025, whether such bank is incorporated in / outside India Small Finance Banks having 10 or more banking outlets in India as on March 31, 2025 Payments Banks having 10 or more banking outlets in India as on March 31, 2025 Non-Banking Financial Companies (NBFCs) fulfilling the following criteria as on March 31, 2025 – Deposit-taking NBFCs (NBFCs-D) with 10 or more branches Non-Deposit taking NBFCs (NBFCs-ND) with asset size of ₹5,000 crore and above and having public customer interface Non-Bank Prepaid Payment Instruments Issuers having more than 1 crore Prepaid Payment Instruments (PPIs) outstan...
Post a Comment
Read more

Financial Literacy Week (FLW) 2026

Reserve Bank of India (RBI) has observed financial literacy week from February 09 to 13, 2026. Financial Literacy and Financial Education Organization for Economic Co-operation & Development (OECD) defines ‘financial literacy’ as a combination of financial awareness, knowledge, skills, attitude and behaviour necessary to make sound financial decisions and ultimately achieve individual financial well-being.  OECD defines ‘financial education’ as the process by which financial consumers / investors improve their understanding of financial products, concepts and risks and through information, instruction and / or objective advice, develop the skills and confidence to become more aware of financial risks and opportunities, to make informed choices, to know where to go for help and to take other effective actions to improve their financial well-being. Financial Literacy Week (FLW) Reserve Bank of India (RBI) has been observing Financial Literacy Week (FLW) every year since 2016 to p...
Post a Comment
Read more

What is Reserve Bank of India – Digital Payments Index (RBI-DPI)? (Updated on February 12, 2026)

There have been continuous efforts by various stakeholders for digitization of payments in the country. But how to we measure the impact of these efforts?  What is Reserve Bank of India – Digital Payments Index (RBI-DPI)? Reserve Bank of India (RBI) has constructed a composite Digital Payments Index (DPI) to capture the extent of digitization of payments across the country. What are the parameters of RBI-DPI? The RBI-DPI comprises of five broad parameters that enable measurement of deepening and penetration of digital payments in the country over different time periods. These parameters along with their weights in the RBI-DPI are as follows –  Payment Enablers (25%) Payment Infrastructure – Demand-side factors (10%) Payment Infrastructure – Supply-side factors (15%) Payment Performance (45%) Consumer Centricity (5%).  Each of these parameters have sub-parameters which, in turn, consist of various measurable indicators.  What is the base year for RBI-DPI? The RBI-DPI ...
Post a Comment
Read more