Announced second debt moratorium for COVID-19 affected borrowers, looking beyond possible impacts to its own bottom line
Offering further assistance to its customers, Sampath Bank PLC extended the debt moratorium to COVID-19 affected businesses and individuals for a second time, from 1st October 2020. This extension was well appreciated by all its customers, judging from the large volumes of applications received from individuals, proprietors, and businesses. Going beyond a singular focus on its own bottom line, the Bank has always strived to be empathetic to the needs of the people, especially as the pandemic continues to cause economic hardship to the nation today.
The second extension allowed affected customers engaged in tourism, direct and indirect export-related businesses including apparel, IT, tea, spices, plantation, logistic suppliers, event management and any sectors that have been adversely affected by work disruption to apply for a further 3-month grace period. The scheme was also extended to Small and Medium Enterprises (SMEs) and individuals engaged in business sectors such as manufacturing, non-financial services, agriculture, construction, value addition and trading businesses including authorized domestic pharmaceutical suppliers, and individuals and businesses who must repay loans in foreign currency and whose incomes/businesses have been adversely affected. Furthermore, any business or individual whose business suffered due to local and overseas lockdowns resulting from COVID-19 as well as self-employment businesses and individuals who have lost their jobs or income due to the pandemic were also able to apply. These extensions were granted unreservedly by the bank, despite the significant costs incurred, and is a fitting reflection of its commitment to its customers in their time of need.
Earlier in the year, Sampath Bank introduced an array of relief measures for individuals and businesses affected by the pandemic which included moratoriums on certain loan repayments. The Bank also waived off all cheque return and stop payment charges until 30th September 2020. Small and medium scale businesses and self-employed individuals were offered relief in making repayments on certain leasing facilities and customers with Sampath Bank personal loans or Sampath Leasing facilities of less than Rs. 1 million were provided relief in making repayments. In full compliance with directives issued by the Central Bank of Sri Lanka, these measures were offered despite the Bank being aware of the pandemic’s possible impact on its own performance.
Extending its support further, Sampath Bank introduced an array of special business loans and gold loans at a significantly low interest rate of 9% p.a. under its Revive Sri Lanka initiative to help medium and large-scale businesses. The Bank also waived off processing fees and penalties on early settlements and facilitated customer requests for a capital grace period of 12 months on capital loans and 6 months on working capital loans. A 3-month Gold loan at a significantly low interest rate of 9% p.a. was announced to support individuals and small-scale businesses with their urgent cash requirements which was again the lowest interest rate on gold loans in the market.
In line with the Sri Lankan Government’s intention to increase the use of solar power among commercial and residential sectors, the Bank introduced a solar loan facility, especially tailor-made for projects to set up solar power units on the rooftops of domestic households and industrial establishments. Under this loan scheme, owners of residential or commercial buildings could obtain loans to install solar power generating units up to a maximum of 50 KWh. These loans are offered at an interest rate of 8% while a maximum loan repayment period of up to 10 years can be granted. Factories and offices were also offered attractive interest rates, with a minimum of Rs. 50 million required to be taken. A maximum loan repayment period of up to 15 years was offered, with a 6-months grace period obtainable if required.
The Bank’s credit card customers saw a reduction in the interest rate to 15% from 28% for local transactions up to a cumulative value of Rs. 50,000/- and minimum payment was lowered to 2.5% from 5% of the statement outstanding. SampathCards also offered 0% interest extended settlement plans on a wide range of essential expenses while the Sampath Bank app was upgraded to include a host of selfcare features which minimized the need to travel and offered greater convenience to customers. To provide customers with safe access to their funds during the lockdown, the Bank partnered with PickMe to enable the delivery of cash withdrawn from an ATM directly to the customer’s doorstep.
Sampath Bank is a 100% local bank that has deeply rooted itself in the lives of the people of Sri Lanka. Established in 1987, the bank has become a state-of-the-art financial institution that continues to be a market leader today thanks to its constant innovation and customer focused approach to business. It has introduced many firsts to the Sri Lankan banking sector including introducing ATMs to Sri Lanka, extended banking hours and slip-less banking to name a few. As part of its visionary 2020 approach, the bank is steadily transforming itself into a ‘Tech Company engaged in banking,’ from the traditional approach of a bank engaged in technology.