Coimbatore: Industrial associations in the district have appealed finance minister Nirmala Sitharaman to direct banks to extend the moratorium on term loan by another one year to June 30, 2022.
With the one-year moratorium period that was announced last year coming to an end, they said many industrial players, who are crippled by the hike in raw material price, wouldn’t be able to repay their term loans.
They wrote to the finance minister on Thursday, stating the micro, small and medium enterprises (MSMEs) were only recovering from the impact of last year’s lockdown and heavily hit by the unprecedented and abnormal increase in prices of raw materials by 70%. They said the second wave of Covid-19 had also affected them.
Read more about Suryoday Small Finance Bank reports 89% dip in profit to Rs 12 cr in FY21 on Business Standard. Suryoday Small Finance Bank (SFB) on Thursday reported an 89 per cent decline in its net profit to nearly Rs 12 crore for the financial year ended March 2021.The bank, which was listed on the bourses in late-March 2021, had reported a net profit of
Banks that had availed funds under those plans, introduced since April-March last year in different phases, were allowed to reverse these transactions before maturity and avail new funds at the prevailing lower repo rate.
MSMEs seek financial package
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Industries, particularly the Micro, Small and Medium-scale Enterprises (MSMEs) in Coimbatore and Tiruppur districts have appealed to the Central and State governments to extend a special financial package to the units.
The Industrial Associations of Coimbatore appealed to the Union Finance Minister to announce a stimulus package for MSMEs that are affected by the pandemic and lockdown.
The interest moratorium for six months has been debited with the entire six months interest on March 31, this year. Further, one-year interest moratorium for principal repayment will start for all the units from June. The units that are already under stress due to interest moratorium and price increase of raw materials, will not be able to meet the payment deadline set by the banks. More than 80% of the MSME units will become NPA and will be forced to shut down their operations, the associations pointed out.