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Mehrishi committee to suggest government bear the burden of compound interest waiver, not banks

Updated : September 19, 2020 01:03 PM IST

The committee is of the view that a complete waiver of compound interest, or interest on interest, for loans under moratorium would tantamount to 'rent seeking' behaviour.
"It would induce moral hazard, waiving interest is like punishing the good borrowers for paying their loans on time," said this person.
The Mehrishi committee also held consultations with banks, other stakeholders before forming its opinion on the matter.
Mehrishi committee to suggest government bear the burden of compound interest waiver, not banks

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