National Bank of India decided to open a special credit facility for small business borrowers affected by the coronavirus outbreak, according to a senior official at India’s largest lender.
The facility aims to address any liquidity concerns among micro, small and medium-sized borrowers who have experienced business disruption due to the Covid-19 pandemic, the official said on condition of anonymity.
Before June 30, borrowers can access loans of up to Rs 200 crore for 12 months at a flat rate of 7.25%, the official said. They will not have to pay processing fees or prepayment penalties on loans made under this facility, the person said.
It is open to borrowers classified as standard or in default for less than 30 days at the time of use of the loan.
SBI is the first lender to allow special loan windows for small borrowers as closures and restrictions to counter the novel coronavirus disrupt business. The Mint newspaper first reported on Friday that SBI has decided to open up ad hoc facilities for small business borrowers.
So far, the Reserve Bank of India has announced three measures to counter liquidity pressure in local money markets as well as foreign exchange markets. She is conducting a six-month, $ 2 billion buy / sell swap to manage the flow of currencies. The RBI also conducts long term repo transactions worth Rs 1 lakh crore. The regulator also carried out operations on the open market worth Rs 10,000 crore and announced an additional purchase of Rs 30,000 crore of government securities.