FAQs about Salary Restructuring

Different parts of the salary are paid to employees and collectively form the salary structure, and it is defined as the fundamental framework for calculating employee compensation. Let’s check out some common FAQs about salary restructuring:

#1:- What is the RBI’s Restructuring Scheme 2.0?

RBI has created a set of guidelines for banks and lenders regarding resolution plans to address the economic effect of the COVID-19 pandemic, which has caused significant customer stress.

#2:- Who is eligible for restructuring?

People who are eligible for restructuring are as follows:

• Entities and individuals that are classified as Standard by the bank on April 1, 2021.
• A customer impacted financially by the COVID-19 pandemic through loss or reduction of cash flow or income.
• Accounts were made with the bank before April 1, 2021.

The bank will review the reduction of income and its financial impact on the customer based on information provided to show a drop in cash flow during the pandemic.

#3:- What products are covered under the restructuring?

Credit card receivables, education loans, auto/two-wheeler loans, personal loans to professionals, housing loans, MSME, and Udyam Certificate loans are covered under the regulatory restructuring relief package.

#4:- Which loans are not qualified for restructuring?

Loans to individuals or entities for agricultural purposes (agriculture loans), financial service providers, agricultural credit societies, HDFC bank employees, central/state/local government bodies, housing finance companies, and loans that have already been restructured are exempt from the recent restructuring relief package.

#5:- How to avail of restructuring benefits on a loan?

You must visit the bank’s website and fill out the relevant application form before submitting the required details. You can also contact your bank’s RM (Relationship Manager) to avail of restructuring benefits.

#6:- Can you apply multiple times for restructuring?

No, an individual or entity cannot apply for restructuring more than once.

#7:- What are the different restructuring options?

If the bank agrees, you can extend the balance tenure of a loan by a maximum of 24 months. This includes the moratorium period to ease your monthly EMI payment.

#8:- Will restructuring have an impact on credit bureau reports?

According to present regulations, the credit facility or loan will be classified as ‘Restructured’ by the credit bureau.

#9:-  How to restructure multiple loans?

You can restructure multiple loans by using the restructuring application form, allowing you to apply for restructuring one or multiple loans on the bank’s website. The bank evaluates the application of regulatory guidelines, the impact of the COVID-19 pandemic, and the feasibility of the repayment plan before making any decision.

#10:-  What documents are required to avail of restructuring benefits?

These are the documents that salaried employees have to furnish to the bank to avail of restructuring benefits:

• Salary slips for March 2021 and the latest salary slip for the last two months
• Declaration of estimated income/salary immediately after the end of the restructuring period (24 months)
• Letter of discharge from a job (in case of job loss)
• Bank statements of salary account from October 2020 to date