My View on the Yes Bank Moratorium

The RBI has released initial guidelines on the moratorium and additional details are still awaited. So I think it is important that customers not panic at this stage and await further clarifications from the government and the RBI on the next steps. The RBI took the decision for the moratorium in consultation with the government to protect depositors' interest and I firmly believe that they will uphold the interests of the retail customers.

The Moratorium notification clearly states that Yes Bank can make a maximum payment of Rs 50,000 to one customer in aggregate taking into account all their accounts with the bank. So, even if you have a SB account and two FDs in your name, the maximum you can withdraw would still be Rs.50,000.

While any payments towards bills received for collection on or before 5 March 2020 will be cleared, anything post that date will be cleared only the aggregate withdrawals by a customer from all their Yes Bank accounts don’t exceed Rs.50,000. This is applicable to ECS mandates and SIPs as well. So if your loan EMI due on 10 March is Rs.40,000 but you’ve already made SIP payments of Rs. 20,000 after 5 March, then your EMI may not be paid out. But if you have not made withdrawals after 5 March, and your loan EMI is Rs.40,000 due on say, 10 March, it would be paid out this month. But post that, you would have only Rs.10,000 left to withdraw. So, come April until further relaxations are announced, you may not be able to pay your EMIs through your Yes Bank account even if it has the required balance.

So, at this stage it would be advisable to shift your EMIs, SIPs and bill payment mandates to another bank account and track updates from RBI. The regulator is acting in the best interest of retail customers and to protect all deposits, so it is important to stay calm and work on solutions to manage short-term payments now. 

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