SBI provides 3-month relief under loan settlement repayment

State Bank of India has given a three-month relief to borrowers under its settlement schemes and will not charge extra interest keeping in mind the COVID-19 pandemic, the country's largest lender said on Wednesday.

Against the backdrop of current disruption in the market and 21 days lockdown till April 14, 2020, State Bank of India (SBI) has come forward to extend the timeline for payment of settlement amount by three months, it said in a statement.

Customers on-boarded under settlement scheme SBI OTS 2019, Rin Samadhan 19-20 and general compromise can meet payment obligation by June 30, 2020, said the country's largest lender.

Under One Time Settlement (OTS) 2019, the extension will be available only to those customers where the first two instalments of 5/15 per centand 20/25 per cent have been received within the stipulated time of 30 days and 60 days respectively.

"The balance OTS amount can be paid by June 30, 2020. Bank will not charge any interest on the amount for this extended period," SBI said.

Likewise, under Rin Samadhan, the timeline for receipt of acceptance of OTS proposal along with upfront payment from borrowers has been extended up to June 30, 2020, from the current March 31, 2020, and up to September 30, 2020, for recovery of entire OTS amount.

This will provide an extended opportunity to borrowers who are unable to visit branches owing to the lockdown, it said.

Besides, thepayment obligations for borrowers with outstanding as on March 1, 2020, under general compromise category has been extended by three months from the respective dates, without charging any interest for an additional period, SBI said.

The lender, along with other public sector banks, has already announced a three-month moratorium on loan repayments and interest on working capital loans by MSMEs, in line with RBI's regulatory package announced on March 27, to help the economy at a time when every business activity has come to a grinding halt in a bid to contain the spread of the deadly coronavirus disease.