Even as the Reserve Bank of India has announced a slew of measures, including a three-month moratorium on term loans, many banks and financial institutions are offering emergency cash facilities and loans to micro and small enterprises (MSEs) and retail borrowers to help them tide over the economic fallout of the coronavirus pandemic.

The Small Industries Development Bank of India has launched SAFE (SIDBI Assistance to Facilitate Emergency response against Corona Virus) scheme to provide financial assistance to MSEs engaged in manufacturing products or offering services to fight Covid-19.

Under the scheme, MSEs engaged in making hand-sanitisers, masks, gloves, head gear, body suits, shoe-covers, ventilators, goggles, testing labs, can avail loans up to ₹50 lakh at a fixed interest rate of 5 per cent for up to five years. “These are collateral free loans and may be sanctioned within 48 hours of applying and submission of documents,” SIDBI said.

Banks step in

Meanwhile, a number of public sector banks have also announced emergency line of credit for existing customers. Union Bank of India has launched COVID Emergency Line of Credit (CELC) Scheme for existing customers. CELC will provide relief to borrowers whose operations are impacted by this outbreak and who are experiencing liquidity mismatch in their day-to-day operation. This will be effective till September 30, 2020.

“We are also working on a scheme tailor-made to mitigate corona effect, especially for small borrower of micro and small category”, a Union Bank of India spokesperson had said.

Bank of India too has announced an emergency credit line for corporate, MSME and retail customers whose cash flows have been affected by the pandemic.

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