Banks Seek Extension Of Loan Relief Scheme For Exporters: Here's Why

With the loan moratorium scheme for exporters set to end on Dec. 31, banks have sought an extension from the Reserve Bank of India (RBI), The Economic Times reported on Monday.

The apex bank introduced the relief measures in mid-November, allowing banks and non-banking financial companies (NBFCs) to offer a temporary halt on loan repayments as well as restructuring options. The move was meant to help exporters facing delayed payments, longer working capital cycles and pressure from global trade disruptions.

Amid the ongoing global economic uncertainty, banks are of the view that exporters are facing stress due to factors such as weak global demand, trade policy issues and tariff-related matters.  According to the ET report, lenders have pointed out that the full impact of these challenges is likely to become clearer in the next quarter.

"Exporters are reaching out to banks seeking an extension of the RBI moratorium scheme," B K Divakara, executive director at CSB Bank, told ET. "Most are waiting for clarity on trade deals to assess the cost impact of tariffs," he added.

The report added that sectors with high exposure to the US, such as marine products, remain under stress. While uptake has been modest so far, bankers expect demand to rise in the next quarter.

"We have not seen any major impact on our portfolio yet. The real impact will be felt next quarter. I am also not ruling out demand for RBI's restructuring scheme," State Bank of India (SBI) Chairman C S Setty told ET in an interview published on Nov. 22.

Setty said it was too early to assess the impact of the 50% tariff imposed by the US on Indian exports, "as many exporters can diversify their geographical markets in a short span of time."

Total bank credit to exporters stood at Rs 2.17 lakh crore as of Sept. 30, RBI data showed. While this forms just 1% of overall bank credit, exports support large employment and nearly one-fifth of India’s GDP. Export services are mainly IT firms, which are largely debt-light, the report added.

Under the RBI’s relief measures, exporters with credit facilities from regulated entities as of Aug. 31, 2025, and classified as standard are eligible to get loan moratoriums. The scheme allows repayment moratorium from Sept.1 to Dec. 31, 2025, with accrued interest converted into a funded term loan repayable between March and September 2026.