Amid the nationwide lockdown imposed for the next 21 days, banks will continue to provide essential services, even as they urge customers to avoid visiting branches and make transactions online.
The Finance Minister announced a slew of relief measures for bank customers yesterday amid the global crisis triggered by the Coronavirus pandemic. These relief measures will remain in place at least for the next three months, and maybe extended if the situation does not improve, Finance Minister Nirmala Sitharaman said on Tuesday.
Charges on withdrawal of cash from own or other bank ATMs have been completely waived off for all debit cardholders for the next three months. Banks have also been asked to waive off any minimum balance requirement, and not impose any fee for non-compliance for the same over the next three months.
Bank charges have also been reduced on digital trade transactions for all trade finance consumers till June 30, 2020.
During the press conference yesterday, Minister of State for Finance Anurag Thakur also indicated that more relief measures may be coming for borrowers impacted by the Coronavirus crisis, but nothing has been firmed up yet and would be communicated once the government takes a call on the matter.
Separately, the Indian Banks Association issued a public notice stating that banks will only provide a few essential services including cash deposits & transfer, cheque clearance, remittances, and government transactions, and the remaining services have been suspended for the time being. Banks are operating branches with limited staff, and with limited working hours from 10 am to 2 pm during these times.
Here is what banks have announced so far.
DCB Bank has announced a commitment of INR 1 crore as part of Corporate Social Responsibility (CSR) for intervention and measures to manage the outbreak of COVID-19 in India. The fund will be deployed within the next 3 months.
State Bank of India has announced to commit 0.25 percent of its annual profit (FY 2019-20) to fight COVID-19 outbreak situation in India. The fund used to fight COVID-19 pandemic will be spent from CSR funds.
Axis Bank has set aside Rs. 100 crore to support customers, employees, vendors, government agencies and the community at large towards curbing the spread of coronavirus. The bank has decided to waive off charges for Savings Account, Current Account and Prepaid Card customers (wherever applicable) towards Online IMPS and ATM financial and non-financial transactions, for the period 23rd Mar – 31st Mar’20 (both days inclusive).
SBI and Union Bank have also introduced an emergency credit line for borrowers impacted by Coronavirus, called the COVID Emergency Credit Line (CELC). Under this facility, borrowers can avail up to or 10 percent of the existing fund based working capital limits for a limited period at reduced rates.
“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 an internal circular reviewed by CNBC-TV18. Loans would be offered at an interest rate of 7.25 percent and will have a tenure of 12 months.
Union Bank of India said on Twitter, “In wake of #coronavirus outbreak, #UnionBankofIndia unstintingly supports all its existing customers with the launch of Covid Emergency Line of Credit (CELC) which provides additional credit facilities to tide over liquidity issues.”
Bank of India has also announced special loans for those affected by COVID, across its MSME, Corporate and Retail segments. Its corporate loan product is called COVID Emergency Support Scheme (CESS 2020) and a personal loan product is called COVID 10 Personal Loan (CPL).
Under CESS 2020, corporates will be eligible for an additional 20 percent of their existing current working capital limit. For personal loan borrowers, additional loans of up to three times last drawn salary will be made available for those with accounts in Bank of India.