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Axis Bank Loan Moratorium

Axis Bank Loan EMI Moratorium

Last Updated 21st Sep 2021

  • Axis bank loan moratorium allows loan borrowers to postpone the payment of EMIs for a selected period of time.
  • Axis bank is offering a loan moratorium for six months, that began from March 1, 2020, and is applicable up to August 31, 2020.
  • Some products have been automatically granted moratorium by the bank; whereas some products require consent from the bank for the moratorium.
  • Availing Axis bank loan moratorium will result in additional interest and extended tenure.

What is Axis Bank Loan Moratorium?

RBI announced a loan moratorium scheme of three months, keeping in mind the financial crisis raised due to the current pandemic, Covid-19. The moratorium period was further extended for another three months as a result of the same crisis. As per the regulations brought out by RBI, earlier Axis Bank offered loan moratorium from March 1, 2020, to March 31, 2020. Now, the bank has further extended the moratorium from June 1, 2020, to August 31, 2020. This moratorium period offered by Axis bank will free the loan borrowers from the financial burden of EMIs for six months as borrowers are not obliged to pay EMIs during the moratorium. However, with the moratorium period, the bank is not completely waving off the payment of EMIs. It is just delaying the EMIs till the end of the moratorium period.

Axis bank loan moratorium provides a sense of financial relief to the loan borrowers for a selected period of time. The loan borrowers will not be required to pay the EMI amount for a pre-decided period if they opt for the moratorium. Once, the moratorium period ends, the payment of the EMIs will come back to its previous schedule. Basically, the loan borrowers of Axis bank can enjoy a financial concession up to August 31, 2020, and will be bound to return to the regular payment of EMI after the said date.

Which loans are eligible for Axis Bank Loan Moratorium?

Axis bank offered a concession on all products during the first moratorium, dated from March 1, 2020, to March 31, 2020. However, it brought a few changes in the formats for the second moratorium period, dated from June 1, 2020, and to August 31, 2020.

As decided by the bank, the following loans have been selected for the second term of the moratorium.

  • Retail Micro Finance and Government-sponsored schemes (June 1, 2020, to August 31, 2020).
  • Kisan Credit Card and Farmer loans (June 1, 2020, to June 30, 2020).

The rest of the loans, such as home loans, personal loans, auto loans, credit cards, rural loans, educational loans, loans against property and so on, borrowers have to make requests for the Axis bank EMI moratorium to avail the benefits. Notably, loan borrowers can only make the request or opt for the moratorium. Allowing or not allowing the waive off relies solely on the bank.

Who should opt for Axis Bank Loan Moratorium?

Due to the current pandemic situation, loan borrowers facing a financial crisis and failing to pay the EMI on time should opt for the Axis bank loan moratorium. It will allow them to stop the payment of EMIs until their financial stability has been restored.

Who should not opt for Axis Bank Loan Moratorium?

If the current pandemic situation has not caused some serious damage to your financial status and you can still manage to pay the EMIs on time, then you can let go of this scheme. As the moratorium is a temporary waive off on the EMIs, borrowers are bound to pay the EMIs when the moratorium period gets over. It means you will have to pay the EMIs sooner or later. Further, it will also save you from the burden of extra interest generated during the period of moratorium.

How to avail Axis Bank Loan Moratorium?

You can avail the Axis bank loan moratorium using the following steps.

  • Visit the Consent section for Moratorium page of Axis bank.
  • Enter the registered mobile number along with your country code.
  • Click on Submit.
  • Enter the OTP sent on the registered mobile number.
  • After the OTP verification, provide the following details
    • Name of the account holder
    • Customer ID
    • Product name (select the type of loan)
  • Click on Submit to complete the process.

No action, as mentioned above, is required if you are not willing to opt for the Axis bank EMI moratorium. Keep paying the EMIs on your regular schedule.

What happens if you opt for Axis Bank Loan EMI Moratorium?

Axis Bank loan EMI moratorium is waive off on the EMIs, not a complete concession. This scheme will free the loan borrowers from the worry of EMI for a maximum of six months. The moratorium will result in two things, i.e., additional interest and an extension of the loan tenure. Loan borrowers will not be obliged to pay the EMIs during the moratorium, but the interest will continue to accrue during this period. The additional interest accumulated during this period will be added to the EMIs once the moratorium period is over. Moreover, the loan tenure will be extended based on the moratorium period selected by the loan borrower.

Impact of Axis Bank Home Loan EMI Moratorium

If loan borrowers opt for the Axis bank home loan moratorium, they will not be obliged to pay the EMIs for their selected moratorium period. They can avail a moratorium period up to six months. However, once the moratorium period ends, i.e., from September, the borrowers will have to resume their EMI payments for the home loan along with the additional interest accumulated during the moratorium period.

For instance, suppose on March 1, 2018, you had taken a house loan of ₹ 30,00,000, at the interest rate of 12%, with a tenure of 84 months. Hence, your EMI will be ₹ 52,958.

Assume you have been paying EMI sincerely and until February 29, 2020, you have already paid 24 EMIs and have 60 pending EMIs. Now, on March 1, 2020, you have opted for a moratorium of six months. In this scenario, the amount of interest due for the months from March to August were:

Months Interest Amount
March ₹ 23,807
April ₹ 23,516
May ₹ 23,221
June ₹ 22,924
July ₹ 22,624
August ₹ 22,320

So, the total interest due during the moratorium period would be ₹ 1,38,412. The revised outstanding principal amount after adding the interest due during the moratorium period with the outstanding principal balance as on March 1, 2020, would be ₹ 25,19,150 . The remaining tenure on September 1, 2020, would be 60 months, and the revised EMI would be ₹ 56,037.

Therefore, it means that after availing moratorium period, the interest you were supposed to pay during those months would be added in your outstanding loan amount of the month from which moratorium started. Plus, after the moratorium, the loan tenure will be the same as it was at the start of the moratorium period, and the EMI would be revised based on the new outstanding loan amount.

The moratorium period need not be of a complete six months. You can select the moratorium period as per your requirement. The additional amount to be added to the outstanding principal depends on the moratorium period opted by you. Once the moratorium period gets over, you will have to start paying the pending EMIs along with the additional home loan interest.

Impact of Axis Bank Auto Loan EMI Moratorium

The auto loan borrowers of Axis bank are eligible to avail the moratorium period. However, the terms and conditions for availing the Axis Bank Auto Loan EMI Moratorium are the same as the Axis bank home loan moratorium. Loan borrowers can postpone the EMIs for their selected moratorium period. However, once the moratorium period is over, loan borrowers will have to start paying their EMIs along with the additional interest accumulated during the moratorium period.

For instance, on June 1, 2018, you had taken an auto loan of ₹ 9,00,000 at the interest rate of 10% with a tenure of 36 months. Therefore, your EMI is ₹ 29,040.

Suppose you have paid regular EMIs till May 31, 2020. Hence, you have paid 24 EMIs, and 12 EMIs are pending. On June 1, 2020, you have decided to opt for a moratorium of three months. In this scenario, the amount of interest due for June, July and August was:

Months Interest Amount
June ₹ 2,753
July ₹ 2,534
August ₹ 2,313

So, the total interest due during the moratorium period would be ₹ 7,600. The revised outstanding principal amount after adding the interest due during the moratorium period with the outstanding principal balance as on June 1, 2020, would be ₹ 3,37,921. The remaining tenure on September 1, 2020, would be 12 months, and the revised EMI would be ₹ 29,709.

Therefore, it means that after availing moratorium period, the interest you were supposed to pay during those months would be added in your outstanding loan amount of the month from which moratorium started. Plus, after the moratorium, the loan tenure will be the same as it was at the start of the moratorium period, and the EMI would be revised based on the new outstanding loan amount.

The moratorium period is not required to be of three months; it can be more or less as per your requirement. The additional amount to be added to the outstanding principal depends on the moratorium period opted by you. Once the moratorium period gets over, you will have to start paying the pending EMIs along with the additional interest.

Impact of Axis Bank Personal Loan EMI Moratorium

In case you opt for the Axis bank personal loan moratorium, you will no longer be obliged to pay EMIs during the moratorium period. However, you should keep the terms and conditions in mind while opting for the moratorium. Interest will keep accumulating during the moratorium period. After the period, the additional interest will be added to the outstanding principal amount. Moreover, the tenure of the loan will be extended as well.

For instance, on April 1, 2019, you had taken a personal loan of ₹ 10,00,000 at the interest rate of 14% with tenure for 48 months. Therefore, your EMI is ₹ 27,326.

Suppose, till March 30, 2020, you have regularly paid EMIs. Hence, you have paid 12 EMIs, and 36 EMIs are pending. On April 1, 2020, you decided to opt for a moratorium of five months. In this scenario, the amount of interest due from April to August was:

Months Interest Amount
April ₹ 9,328
May ₹ 9,118
June ₹ 8,906
July ₹ 8,691
August ₹ 8,473

So, the total interest due during the moratorium period would be ₹ 44,516. The revised outstanding principal amount after adding the interest due during the moratorium period with the outstanding principal balance as on April 1, 2020, would be ₹ 8,44,059. The remaining tenure on September 1, 2020, would be 36 months, and the revised EMI would be ₹ 28,848.

Therefore, it means that after availing moratorium period, the interest you were supposed to pay during those months would be added in your outstanding loan amount of the month from which moratorium started. Plus, after the moratorium, the loan tenure will be the same as it was at the start of the moratorium period, and the EMI would be revised based on the new outstanding loan amount.

The moratorium period is not required to be for five months. You can select a moratorium period of up to six months. The additional amount to be added to the outstanding principal depends on the moratorium period opted by you. Once the moratorium period gets over, you will have to start paying the pending EMIs along with the additional interest.

Impact of Axis Bank Credit Card EMI Moratorium

Credit cardholders can opt for Axis bank credit card EMI moratorium to postpone the payments of credit cards or for the payment of loans taken against credit cards.

In case of credit card monthly bills, cardholders always have the option of just paying the minimum balance due and carry the remaining balance to next month. However, if you do not want to pay even the minimum balance, then the complete balance will be carried from month to month till the end of the moratorium period. During the moratorium period, your credit card balance will continue to attract interest along with your further purchases. Also, you can convert your credit card balance into EMIs only after opting out of moratorium.

Since the rate of interest on the credit card is high, it is strongly recommended to continue paying the dues so that you can avoid paying a high amount of interest later on.

In case of credit card loan, the moratorium will work similarly as loan types. So, for instance, on March 1, 2019, you had taken a credit card loan of ₹ 5,00,000 at the interest rate of 18% with tenure for 36 months. Therefore, your EMI is ₹ 18,076. Now, until February 29, 2020, you have regularly paid EMIs. Hence, you have paid 12 EMIs, and 24 EMIs are pending. On March 1, 2020, you decided to opt for a moratorium of six months. In this scenario, the interest amount from March to August was:

Months Interest Amount
March ₹ 5,431
April ₹ 5,241
May ₹ 5,049
June ₹ 4,853
July ₹ 4,655
August ₹ 4,454

So, the total interest due during the moratorium period would be ₹ 29,683. The revised outstanding principal amount after adding the interest due during the moratorium period with the outstanding principal balance as on March 1, 2020, would be ₹ 3,91,757. The remaining tenure on September 1, 2020, would be 36 months, and the revised EMI would be ₹ 19,558.

Therefore, it means that after availing moratorium period, the interest you were supposed to pay during those months would be added in your outstanding loan amount of the month from which moratorium started. Plus, after the moratorium, the loan tenure will be the same as it was at the start of the moratorium period, and the EMI would be revised based on the new outstanding loan amount.

FAQs

Is any additional documentation required for availing the Axis bank loan moratorium?

Individual and non-individual loan borrowers with an outstanding loan amount of less than ₹ 500 lakhs are not required to submit any additional documents. However, non-individuals loan borrowers with an outstanding loan amount of more than Rs. 500 are required to submit a detailed form justifying their need for the moratorium.

Will interest be charged during the moratorium period?

Yes, the interest will be accrued during the moratorium period. The interests accumulated during the moratorium period will be added to the EMI at the end of the moratorium period.

I had availed the moratorium, do I need to re-apply for extending the moratorium?

The earlier request for a moratorium was valid till May 31, 2020. To avail the moratorium dated from June 1, 2020, to August 31, 2020, you will have to re-apply.

If I avail the Axis bank loan moratorium, will it impact my credit score?

No, availing the Axis bank loan moratorium will not affect your credit score.

If I avail moratorium for a loan taken against my shares, can I sell the shares during the moratorium period?

No, you can not sell the shares if you have availed moratorium for a loan taken against your shares. To sell the shares, you need to clear all accumulate dues or withdraw your request for the moratorium.

If I avail the moratorium, will the terms and conditions of my loan agreement change?

No, if you avail the moratorium, it will not alter any terms and conditions except for the deferment to pay your EMIs.

What will happen if I don’t want to avail the moratorium?

If you are not willing to avail the moratorium, no additional action is required from you. Just keep paying the EMIs regularly as you did so far.

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