State Bank moratorium on consumer loans’ principle

The State Bank of Pakistan (SBP) has announced relief for the consumers after the coronavirus outbreak.

The banks and development finance institutions (DFIs) would defer the principal amount on consumer loans to support the borrowers in the ongoing coronavirus situation.

The SBP posted on their official twitter account that borrowers availing consumer finance for auto, housing, and personal loans and credit cards, who remained punctual on their payments up till December 31, 2019, are allowed to request banks to defer amount for one year without fee or increase in a mark-up.

(1/4)Borrowers availing consumer finance (auto, housing, personal loans, credit card)& who were regular on their payments up till 31Dec19 can request banks to defer principal amount for 1 year without any fee or increase in markup.They will continue to service the mark-up amount.

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— SBP (@StateBank_Pak) March 30, 2020

But they would continue to service the mark-up amount. 

It was also written, “Borrowers who are unable to service the mark-up amount or need deferment exceeding one year, may request the bank to reschedule/ restructure their facilities,”

the central bank had earlier in a circular incorporating revised prudential regulations said that banks/DFIs, upon a written request of an obligor received before June 30, 2020, would offer deferral of principal comportment of installments for one year, unless the customer requests for a shorter period, at no fee or increase in mark-up rate or mark-up on mark-up; provided that the obligor would continue to service the mark-up amount as per agreed terms and conditions.