Moratorium on repayment of loans in coastal areas

Our Economy Bureau
13 January 2005

Kochi: The state-level bankers committee (SLBC) has agreed to a six-month moratorium on repayment of all bank loans taken by borrowers from the coastal areas in view of the hardship they have been facing since the tsunami disaster.

After the meeting, chief minister Oommen Chandy, who is the chairman of the SLBC, told newsmen that the loans would also be conveniently restructured for 5 to 7 years for the benefit of coastal dwellers.

Commercial banks would provide Rs5,000 as consumption loans to families in the tsunami-hit villages at a lower rate of interest of 7 per cent without any security. Those whose means of livelihood were lost would be eligible for a loan of Rs6,500 at 4 per cent interest.

Fishermen, who had lost fishing vessels and nets, could borrow Rs75,000 at 7 per cent. The government would bear a portion of this as grant, which would be finalised by the state cabinet. Chandi also disclosed that the grants would be credited in to the bank accounts of the fishermen, who would be allowed to open accounts with an opening amount of Rs10.

The SLBC has further agreed to relax norms for educational loans to the families of fishermen. The chief minister said that the banks had also decided to assist with the rehabilitation of tsunami-hit families.

Chandy also said that the 250 families in the Ernakulam district, who lost houses in the tsunami tides, would be given Rs 7,500 each for temporary shelter as decided at a meeting with the representatives of the affected families.