COVID-19: SBI opens emergency credit line

To help clients tackle liquidity mismatch

The State Bank of India (SBI) has taken the lead in providing relief to its customers to tide over the crisis caused by the spread of COVID-19, by opening emergency credit lines with a maximum limit of Rs. 200 crore.

The scheme will be in force till June 30. The loan tenure will be 12 months with an interest rate of 7.25%. All standard accounts that have not been classified as SMA (Special Mention Account) 1 or 2 as on March 16 and till the date of sanction are eligible, a circular issued by the SBI said.

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

Customers can avail up to 10% of the existing fund-based working capital limit and the maximum amount they can get is Rs. 200 crore. The loan can be availed of in one go.

“However, the total additional exposure, including the present facility, should not exceed 25% of the fund--based working capital exposure,” said the circular reviewed by The Hindu .

There will not be any processing fee or prepayment penalty for such a loan.

The loan is repayable in six equated monthly instalments after a moratorium of six months from the date of disbursement of the loan.

The purpose of the loan is to meet the temporary liquidity mismatch arising out of COVID-19.

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