Which is better: payment holidays or restructuring?

Payment holidays can be compared to unpaid leave. The Borrower receives a payment deferral, but the bank accrues interest and adds it to the principal debt. It will still have to be paid, but the borrower gets time to restore solvency. The maximum period of payment holidays is 6 months.

Restructuring does not cancel the monthly payment, but reduces it to an affordable amount. The interest rate remains the same, but the debt is spread over time, making it easier to repay. This debt burden reduction option applies for the entire term of the credit agreement.

Which is better, payment holidays or restructuring, depends on the borrower's personal circumstances.

• The first option makes sense if the financial difficulties are temporary or arose for reasons beyond your control (pandemic, sanctions). Such a deferral will provide some breathing space and will have a less negative impact on your credit history.
• If payment holidays do not solve the problem, use loan restructuring. Although it may slightly damage your borrower reputation, it will help avoid overdue payments.