- Finance Ministry issues statement calling on companies to submit paperwork
- Reiterates working capital, debt restructuring and additional loans available
The Finance Ministry yesterday called on all Small and Medium Enterprises (SMEs) wishing to avail themselves of the Government’s moratorium to submit their applications to their relevant bank branches before the end of this month.
The deadline for the applications is 31 January, the Finance Ministry said in a statement, pointing out that SMEs that had taken loans less than Rs. 300 million were eligible to have their loans restructured under this program.
Banks have already stopped taking legal measures against companies that had stopped making their monthly payments and also suspended penalties on companies. The statement also said a circular from the Central Bank had also been issued to update the banks on the moratorium.
“It is essential that companies notify banks of their intention to avail themselves of the moratorium in writing before 31 January. Under this scheme, if a company has repaid 50% of its loan then 50% of its remaining interest rate will be written off and the time to repay the loan will be doubled. Companies will also be given working capital under a guarantee provided by the Central Bank,” the Finance Ministry said.
Companies that have maintained loan repayments will be given an additional year to complete their repayments and they can also obtain additional loans up to Rs. 300 million, the Finance Ministry added.
The moratorium was announced by the Government in December. This, together with the stimulus package presented shortly after the Presidential Elections, is expected by the Government to boost demand and drive growth. The Central Bank estimates Sri Lanka grew at less than 3% in 2019.