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Sunday Dec 22, 2024
Friday, 31 January 2020 00:50 - - {{hitsCtrl.values.hits}}
The Central Bank yesterday said the deadline for Small and Medium Enterprises (SMEs) to apply for the loan moratorium provided by the Government has been extended from today to 10 February.
The Government had earlier said the scheme applies to SMEs in manufacturing, services, agriculture (including processing) or construction, with annual turnover of Rs. 16-750 million in 2019, and total outstanding loans of up to Rs. 300 million at end 2019.
It also covers loans to the tourism sector with a capital and interest moratorium until end March 2020. Banks must apply the scheme by 31 March.
However, Central Bank Deputy Governor H.A Karunaratne told reporters that the guidelines have since been changed, with the lower threshold of Rs. 16 million being removed. He also said that borrowers engaged in the tourism industry who have taken personal loans for business purposes can avail themselves of the moratorium if they are registered with Sri Lanka Tourism Development Authority.
Karunaratne also downplayed possible exposure to the banks from the moratorium, pointing out that SME loans only make up about 12% of overall loan portfolios of banks.
“According to our understanding in the past only about 30% of people who are eligible for a moratorium have actually requested for it. Therefore we do not see huge exposure coming from this sector,” he said, adding that the circular will be amended to reflect the extended deadline.
