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Monday, May 27, 2024

Stalin writes to Nirmala seeking MSMEs loan repayment moratorium due to Cyclone

Date:

) Tamil Nadu Chief Minister M.K.Stalin has written to Union Finance Minister Nirmala Sitharaman seeking three months moratorium of repayment of loans by MSMEs in view of the devastation caused by the cyclone.

In a Demi-Official letter to Ms Nirmala, Mr Stalin requested her to provide moratorium on loan repayment for MSMEs and small businesses and also crop and other loans.

Mr Stalin, citing the damages caused in four districts viz., Chennai, Kancheepuram, Tiruvallur and

Chengalpattu, urged her to take the issue into consideration and accept the request of the State government in providing moratorium on loan repayment from December one, 2023 to February 29, 2024.

Seeking her urgent intervention, the Chief Miniser urged her to direct all commercial banks (including regional rural banks, small finance banks and local area banks), co-operative banks, All-India Financial Institutions and Non-banking Financial Companies (including housing finance companies) to issue a moratorium for a period of 3 months from 1st December, 2023 to 29th February 2024 on payment of all instalments in respect of all term loans (including agricultural term loans, retail and crop loans) availed by families and business units in these four districts.”.

“I wish to draw your attention to the urgent need for providing a moratorium on loan repayments to the families impacted by Cyclone Michaung in Chennai, Chengalpattu, Kanchipuram and Thiruvallur districts”, he said.

The 37 lakh families living in the aforementioned four districts of Tamil Nadu, have borne the brunt of relentless rain which has caused significant disruption in their livelihood and damages to their properties”, he said.

“Although we have been able to restore normalcy in their daily lives, the impact on their livelihood still lingers for many. Small businessmen, traders and MSME units impacted by the floods are yet to return to their regular economic activities. Many of these families and business entities have availed loans for various purposes and would be finding it impossible to repay their dues in these difficult circumstances”, the Chief Minister said.

There is an urgent need to mitigate the burden of immediate debt servicing by relaxing repayment schedules till they come out of this crisis, he added.

“Therefore, I kindly request your urgent intervention to direct all commercial banks (including regional rural banks, small finance banks and local area banks), co-operative banks, All-India Financial Institutions and Non-banking Financial Companies (including housing finance companies) to issue a moratorium for a period of 3 months from 1st December, 2023 to 29th February 2024 on payment of all instalments in respect of all term loans (including agricultural term loans, retail and crop loans) availed by families and business units in these four districts”, he said.

The repayment schedule and all subsequent due dates, as well as the tenor for such loans may be shifted across the board by three months. With respect to working capital facilities sanctioned in the form of cash credit/overdraft, the lending institutions may be permitted to allow a deferment of three months on payment of interest on all such facilities outstanding as on 1st December, 2023.

Considering the urgency of the issue, I request your personal intervention in this regard and issue immediate directions to ease the repayment burden on the affected people, he said.

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