Coimbatore: N.Karthik MLA has appealed to the government to provide entrepreneurs in Coimbatore with collateral-free loans of Rs 1 lakh to Rs 5 lakh through banks based on their transactions.
Coimbatore: N.Karthik MLA has appealed to the government to provide entrepreneurs in Coimbatore with collateral-free loans of Rs 1 lakh to Rs 5 lakh through banks based on their transactions.
In a petition to the District Collector he stated that the MSME's that are in Coimbatore have stopped production since March due to the lockdown and are finding it difficult to even provide salary to their employees.
Only the existing nationalized banks and private banks in Coimbatore, which already have credit (CC) or overdraft (OD) account holders, currently lend to their customers with an increase of 20 per cent over the amount of credit granted to them, but no loan has been given so far to entrepreneurs who have only current accounts in banks and have not taken any bank loans so far. So they have resorted to private financial institutions for loans even if the interest rates are high.
He said that this has led to them struggling for their livelihood and they are unable to pay interests. He, therefore, demanded that entrepreneurs who have only current accounts should be given collateral free loans ranging from Rs 1 lakh to Rs 5 lakh based on their banking transactions through the nationalized banks and private banks.
He pointed out that during a review meeting at the Coimbatore District Collectorate with District Collector and banking executives, it was decided to provide loans for entrepreneurs due to COVID-19. He said that many banks have not implemented the announcement in practice, citing the fact that they have not received any notifications from the government regarding lending.
He said the government should make the necessary efforts to ensure that the banks implement this announcement as the entrepreneurs have been unable to repay their bank loans as they are unable to run their business as usual. He requested that considering the extraordinary situation, the deadline should be extended till December 2020 to repay their bank loans to help these industries recover.
He also pointed out all the banks and financial institutions do not waive the interest on the loans but simply add it to the principal and increase the outstanding amount thereby increasing the burden. Hence, he requested the interest on the loan should be waived for 6 months. He requested the District Collector to consider these reasonable requests of the entrepreneurs in Coimbatore and recommend to the Central and State Governments for their implementation.
In a petition to the District Collector he stated that the MSME's that are in Coimbatore have stopped production since March due to the lockdown and are finding it difficult to even provide salary to their employees.
Only the existing nationalized banks and private banks in Coimbatore, which already have credit (CC) or overdraft (OD) account holders, currently lend to their customers with an increase of 20 per cent over the amount of credit granted to them, but no loan has been given so far to entrepreneurs who have only current accounts in banks and have not taken any bank loans so far. So they have resorted to private financial institutions for loans even if the interest rates are high.
He said that this has led to them struggling for their livelihood and they are unable to pay interests. He, therefore, demanded that entrepreneurs who have only current accounts should be given collateral free loans ranging from Rs 1 lakh to Rs 5 lakh based on their banking transactions through the nationalized banks and private banks.
He pointed out that during a review meeting at the Coimbatore District Collectorate with District Collector and banking executives, it was decided to provide loans for entrepreneurs due to COVID-19. He said that many banks have not implemented the announcement in practice, citing the fact that they have not received any notifications from the government regarding lending.
He said the government should make the necessary efforts to ensure that the banks implement this announcement as the entrepreneurs have been unable to repay their bank loans as they are unable to run their business as usual. He requested that considering the extraordinary situation, the deadline should be extended till December 2020 to repay their bank loans to help these industries recover.
He also pointed out all the banks and financial institutions do not waive the interest on the loans but simply add it to the principal and increase the outstanding amount thereby increasing the burden. Hence, he requested the interest on the loan should be waived for 6 months. He requested the District Collector to consider these reasonable requests of the entrepreneurs in Coimbatore and recommend to the Central and State Governments for their implementation.