Bank business revival units to be strengthened to assist SMEs : CB Governor

Sri Lankan bank business revival units set up during the COVID-19 pandemic period will be strengthened to operate independently under current normal circumstances to help SMEs that have bad loans to continue their operations, Central Bank (CB) Governor Nandalal Weerasinghe told a media conference on Tuesday.

New guidelines will be issued by the Central Bank next week to maintain and strengthen these units by banks to facilitate the revival of those enterprises hit by the economic crisis, journalists at the second monetary policy review briefing, were told.

Banks will have to extend loans facilities at concessionary loans to restructure their business entities affected by the recent challenging macroeconomic circumstances, he said.  

The new broad guidelines give effect to further strengthen business revival units in the recovery of SMEs and corporates, he disclosed requesting banks to be lenient in granting loans at current interest rates.  

However, he noted that suspension of the parate executions is a temporary measure but it is unavoidable for banks to be reluctant to provide loans to small and medium provide enterprises.

Elaborating this new policy measures, senior deputy governor of the Central bank Yvette Fernando noted that the monetary board has given approval to expand the scope of the bank business revival units to operate as a normal service with the technical assistance of the World Bank  

This unit will be operated independently under a deputy general manager and a frame work will be devised to transform these affected entities to resume the payment of loan instalments in a normal way. (Bandula)