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Banks prepare to meet credit challenges in flood-affected areas of Kerala

Representatives of 18 banks said they were awaiting the government’s financial support to reduce the burden on farmers in terms of interest repayment.

Published: 22nd August 2019 03:26 AM  |   Last Updated: 22nd August 2019 03:26 AM   |  A+A-

By Express News Service

THIRUVANANTHAPURAM: With the floods affecting large portions of the state in two consecutive years, banks are facing an unprecedented situation as the concessions extended to loans in previous floods could be extended further before the term ends. State Level Bankers’ Committee (SLBC) is slated to convene a special meeting to discuss the financial relief measures. 

Besides restructuring, banks have provided other credit-related relief measures last year which included fresh loans and margin waiver. Banks recommended extending the moratorium on farm loans till December this year.  “We also need directions from RBI on restructuring loans that are already restructured,” said GK Maya, convenor, SLBC Kerala and general manager, Canara Bank. She was speaking to media persons at a meeting held jointly by SLBC and Department of Financial Services on Wednesday. 

Banks awaiting notification

According to Maya, banks are waiting for notification from the Revenue Department on the extent of damage to decide on its actions. Last year, banks had extended relief measures to 1,259 villages declared flood-affected by the government. Representatives of 18 banks present at the meeting said they were awaiting the government’s financial support to reduce the burden on farmers in terms of interest repayment. The meeting also discussed challenges faced by the banking sector and ways to improve the efficiency of public sector banks. 

More from Kerala.

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