RBI Governor Shaktikanta Das today (May 22) said that the Central bank has decided to extend the moratorium on payment of loans by another 3 months. "This is till August and is meant to provide relief to borrowers whose incomes have received a blow due to Covid-19," Das said at a presser.

The first three-month moratorium was to end on May 31. It will now end on August 31.

"EMI repayments of retail loans have not been deducted by banks in order to provide liquidity to people," Das said.

Union Finance Minister Nirmala Sitharaman has welcomed the Governor's decision to reduce the repo rate. "The Monetary Policy Committee today decided to cut the policy repo rate by 40 bps to 4.0% with immediate effect, cut the reverse repo rate to 3.35% from 3.75%," she said, suggesting that the rate cut is in keeping with the government's fiscal policy.