RBI expands Resolution Framework 2.0

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Mumbai:  In a relief for borrowers, the RBI expanded the coverage of Resolution Framework 2.0 announced on May 5, 2021. Maximum aggregate exposure threshold under Resolution Framework 2.0 has been increased to Rs 50 crore from Rs 25 crore for MSMEs, non-MSMEs and in case of loans to individuals for business purposes.

“The Resolution Framework 2.0 announced by the Reserve Bank on May 5, 2021 stipulates a maximum aggregate exposure of Rs. 25 crore for considering resolution of COVID-19 related stress of MSMEs as well as non-MSME small businesses, and loans to individuals for business purposes. Based on a review, it has been decided to enhance the above exposure threshold to Rs.50 crore. Accordingly, the above categories of borrowers to whom the lending institutions have aggregate exposure of not more than ₹50 crore as on March 31, 2021, and which have not been restructured earlier under any of the specified restructuring frameworks, shall be eligible to be considered for resolution under Resolution Framework 2.0. All other conditions shall remain the same” said RBI.

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