March 18, 2020 / 10:01 AM / 23 days ago

Government, RBI mull relaxing bad loan rules for sector hit by coronavirus

An India Rupee note is seen in this illustration photo June 1, 2017. REUTERS/Thomas White/Illustration

NEW DELHI (Reuters) - India’s government and central bank are considering giving relief to banks, aviation and other hospitality sectors hit by the coronavirus outbreak by relaxing bad loan classification rules, a source familiar with the matter said.

The government is discussing increasing timeline by 30-60 days to classify a loan as a bad loan, the source said. Currently, a debt not serviced for 90 days is classified as a bad loan.

Reporting by Aftab Ahmed; Editing by Alex Richardson

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