On 19 July 2023, the Chennai District Consumer Redressal Commission ordered a bank to pay compensation to a consumer, for having illegitimately deducted some monthly installments on his loan while a moratorium on loan repayments was in place due to COVID-19 and the subsequent lockdown.

The consumer had stipulated a loan agreement offering his car as collateral and had always paid the monthly installments. However, in March 2020 the government, in the light of the pandemic, ordered a lockdown and issued a moratorium on loans from 1 March 2020 to 31 August 2020. During this period, the bank deducted two monthly installments from the consumer, thus leaving him with scarce resources for living during the lockdown. The consumer filed some complaints which were left unanswered.

The matter was thus brought before the Commission, which pointed out that the bank’s conduct represented a deficiency in service and ordered the bank to pay compensation to the consumer for such deficiency and for the distress caused.

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