RBI introduces 'calamity chapter' for accounts not overdue 30 days
The RBI just rolled out a "calamity chapter" to make getting financial relief after natural disasters faster and clearer.
The big change? Only borrowers whose accounts were in good shape (not overdue by more than 30 days) when the disaster hit will qualify for help.
This is separate from earlier restructuring rules, so it's a fresh approach.
Banks can automatically offer relief
Now, banks can automatically offer relief based on recommendations from banking committees: no need for borrowers to jump through hoops or fill out requests (though you can say no if you don't want it).
There's also a 5% buffer rule for these restructured loans, and banks get to keep recognizing income as usual.
All of this is meant to make sure relief funds go where they're needed most, and aren't used to cover up old financial problems.