As its commitments to providing relief to businesses affected by the COVID-19 pandemic continue to grow exponentially, the Commercial Bank of Ceylon has announced the launch of ‘Arunella’ – a Financial Support Schemed that will bring together its multiple initiatives in this sphere, enabling sharper focus and better integration of schemes.
The Bank said the Arunella Financial Support Scheme would encompass 11 different programmes already implemented by the Bank for affected businesses and individuals as well as a 12th initiative just unveiled to provide relief beyond the expiry of current debt moratorium periods.
The latest relief programme consists of Special Payment Relief Schemes that will extend special concessions for several months beyond the existing debt moratoria to help customers that continue to be affected by the economic fallout of the COVID-19 pandemic.
These concessions include flexible payment options, up to 20% rebates on accrued interest during the moratorium periods, extension of moratorium periods for up to another six months, further reductions on Credit Card repayments and applicable interest rates, and Debt Consolidation Plans.
Home Loan and Personal Loan customers, Leasing customers, Credit Card customers, and SME borrowers of the Bank will be eligible for these concessions.
“We are very conscious of the fact that a large number of borrowers are going to need support longer than originally envisaged when the Central Bank announced the moratorium periods for different categories of borrowers,” Commercial Bank Managing Director S. Renganathan said. The new Payment Relief Scheme offers eligible customers flexible payment options to settle their debts.
The Bank has also designed several options for Equated Monthly Installment (EMI) loans for borrowers eligible for concessions under criteria announced by the Central Bank of Sri Lanka (CBSL) as well for those who do not fall within CBSL eligibility criteria.
These schemes offer interest-free loans of up to 90% of the value of accrued interest, for up to 24 months or the balance tenor of the original loan.
For borrowers that do not meet CBSL eligibility criteria, Commercial Bank will offer interest-free loans for accrued interest for a maximum period of six months.
Special concessions to Credit Card holders include a reduction in the monthly minimum amounts payable for Credit Card outstanding bills, from the current 2.5% to 1% for the first six months and up to 2% for the next six months.
Additionally, the Bank has also introduced a Special Card Repayment Plan with reduced interest rates to lessen the burden of payment on customers already in the non-performing category.
Special interest rates applicable to those who apply are 2% for full settlement within three and six months, 6% for settlement within 12 months, 9% for within 18 months, and 12% for within 24 months.
The Bank has also launched Debt Consolidation Plans as part of the new Payment Relief Scheme.
Furthermore, if the loan capital is proposed to be settled from cash flow expected from the disposal of any asset owned by the borrower, this debt amount can be converted to a separate loan and be repaid from the sale of said asset within the period of a year.
Under the working capital loan scheme launched by CBSL, Commercial Bank submitted 4021 applications with a total value of Rs 19.6 billion. Approval was granted for 734 applications with a value of Rs 2.8 billion.
The Commercial Bank of Ceylon has also launched two separate bank-funded support loan schemes since May 2020 to support COVID-19 affected SMEs and micro enterprises.
Additionally, Commercial Bank has taken action to reduce advances rates by up to 4% in some categories within the year. Among other concessions, the Bank also provided a Special Card Repayment Plan for its Credit Card holders.
Following the CBSL’s COVID-19 Relief Scheme Circular in April, Commercial Bank announced a series of concessions for borrowers whose loans had already been classified as non-performing.
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