The Central Bank has directed banks to extend debt moratorium on capital and interest to businesses and individuals in passenger transportation until 30 June 2022.

The move is as part of measures to help overcome challenges faced by businesses and individuals providing public and private passenger transportation services, including the tourism sector, amidst the COVID-19 pandemic.

Banks have been directed to extend the same relief detailed in the 1 September and 13 September circulars of the CBSL to all individuals and enterprises for lease facilities obtained by businesses and individuals in the passenger and tourist transportation sector.

Banks also have been told to waive off the accrued and unpaid penal interest as of 1 October 2021, if any, on performing loans. Penal interest shouldn’t be accrued and charged during the moratorium period as well. Additionally, banks should suspend all types of recovery actions against non-performing facilities until 30 June 2022, provided that such facilities have been classified as non-performing on or after 1 April 2020. Further, licensed banks shall take all the precautions not to excessively contact/force the borrower or visit the borrower as part of the routine collection procedure with regard to the above borrowers. In instances where there are ongoing litigations in courts relating to recovery, borrowers shall enter into an agreement in the Courts to obtain this concession.

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