SBI opens credit line for Covid-hit borrowers

Mumbai, March 21

Advertisement

Amid businesses getting affected due to the novel Covid-19 pandemic, the country’s largest lender State Bank of India has opened an emergency credit line to meet any liquidity mismatch for its borrowers.

The additional liquidity facility — Covid-19 Emergency Credit Line (CECL) — will provide funds up to Rs 200 crore and will be available till June 30, 2020, SBI said in a circular issued on Friday.

The loan will be offered at an interest rate of 7.25 per cent with a tenure of 12 months.

“With a view to provide some degree of relief to the borrowers whose operations are impacted by Covid-19, it is decided to make available additional liquidity credit facilities to the eligible borrowers by way of ad-hoc facilities CECL to tide over the current crisis situation,” the bank said in a circular to all branches.

The bank said the credit line was open for all standard accounts that had not been classified as SMA 1 or 2 as on March 16, 2020.

Special Mention Accounts (SMA) was introduced to identify those accounts that had the potential to become an NPA/stressed asset. SMA-1 accounts are those where the overdue period is between 31 to 60 days, while in SMA -2 accounts, overdue is between 61 to 90 days.

Borrowers can avail a maximum 10 per cent of the existing fund-based working capital limits, subject to a cap of Rs 200 crore, the bank said.

According to a recent survey conducted by industry body, FICCI, over 50 per cent of companies in the country saw impact of Covid-19 on their operations.

Nearly 80 per cent businesses have witnessed decline in cash flows due to the global pandemic, it showed. — PTI

Box

Nod to Rs40,995-cr sops for electronic firms

New Delhi: The Union Cabinet has approved production-linked incentives worth Rs 40,995 crore for electronics manufacturing companies, said Communications Minister Ravi Shankar Prasad. “We will give Rs 40,995 crore in the coming five years for production linked-incentive and hope to generate manufacturing revenue potential of Rs 10 lakh crore by 2025,” he said.