Tamil Nadu Chief Minister MK Stalin has requested Union Finance Minister Nirmala Sitharaman to provide a moratorium on loan repayment for small businesses, particularly to those people who were affected by the Cyclone 'Michaung' that hit the state earlier this month.
He requested the Union Finance Minister to direct all commercial banks (including regional rural banks, small finance banks, and local area banks), co-operative banks, all-India financial institutions, and non-banking financial companies (including housing finance companies) to issue a moratorium for a period of three months from December 1, 2023, to February 29, 2024, on payment of all instalments in respect of all term loans (including agricultural term loans, retail, and crop loans) availed by families and business units in these four districts.
"I wish to draw your attention to the urgent need for providing a moratorium on loan repayments to the families impacted by Cyclone Michaung in Chennai, Chengalpattu, Kanchipuram, and Thiruvallur districts. The 37 lakh families living in the aforementioned four districts of Tamil Nadu have borne the brunt of relentless rain, which has caused significant disruption to their livelihood and damages to their properties," read CM Stalin's letter to the Union Finance minister.
Stalin said though the state government had been able to restore normalcy in people’s daily lives, the impact on their livelihood lingered for many. He wrote, "Small businessmen, traders, and MSME units impacted by the floods are yet to return to their regular economic activities. Many of these families and business entities have availed loans for various purposes and would find it impossible to repay their dues in these difficult circumstances. There is an urgent need to mitigate the burden of immediate debt servicing by relaxing repayment schedules till they come out of this crisis."
"The repayment schedule and all subsequent due dates, as well as the tenor for such loans, may be shifted across the board by three months. With respect to working capital facilities sanctioned in the form of cash credit/overdraft, the lending institutions may be permitted to allow a deferment of three months on payment of interest on all such facilities outstanding on December 1, 2023," the letter read.
"Considering the urgency of the issue, I request your personal intervention in this regard and issue immediate directions to ease the repayment burden on the affected people," he wrote.