Has RBI introduced the facility of bifurcating the loan

This plan is an already introduced plan, you can split your loan into two installments and reduce the monthly debt burden.

RBI introduced the facility of bifurcating the loan

RBI has introduced the facility of bifurcating

Reserve Bank of India (RBI) has introduced the facility of bifurcating the loan. This means that a loan can be split into two parts: a term loan and a working capital loan.

This facility was introduced in December 2018 through Master Circular No. 48/2018-19. The circular states that bifurcation of working capital facility into loan component and cash credit component shall henceforth be maintained at individual bank level in all cases, including consortium lending.

There are several benefits to bifurcating a loan.

It can help businesses to better manage their cash flow.

It can make it easier for businesses to access working capital loans at lower interest rates.

It can help businesses to reduce their overall debt burden.

To bifurcate a loan, businesses will need to contact their bank and request the facility. The bank will then assess the business's financial needs and determine whether or not it is eligible for the facility.

If the business is eligible, the bank will split the loan into two parts: a term loan and a working capital loan. The term loan will be repaid over a fixed period of time, while the working capital loan will be repaid on a revolving basis.

The bifurcation of loans is a welcome step by the RBI. It can help businesses to better manage their finances and grow their businesses.

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