Individuals affected by the COVID-19 pandemic can choose to defer loan repayments until June next year. The Prime Minister’s office issued a news release today announcing the loan deferment as the pandemic shows no signs of slowing down.
According to the news release, all loans sanctioned as of June 30 last year shall be eligible for the deferment of loan repayment for another year, from July this year to June next year.
However, depending on the borrowers’ repayment capacity, Financial Service Providers (FSP) may extend the loan tenure by postponed periods or up to five years to relieve the burden of loan repayment on the borrowers.
And regular repayments during the deferment periods, on the other hand, will be rewarded with incentives. Borrowers who pay their loan instalments throughout the deferment period will receive a one per cent interest decrease on their term loans for another year from the FSPs.
In the case of loans, the FSPs may lend up to 100 per cent of the collateral value within the Loan-To-Value limit. For instance, in the case of a loan for purchase or construction of a second or any subsequent property, LTV shall not exceed 70 per cent of the value of the property.
The LTV restrictions for housing and vehicle loans, however, would stay unchanged. In addition, the FSPs may use uniform land rates for valuation purposes if they agree on a modality.
In addition, the government also extended fiscal measures until December this year. It is to ensure sustained economic stability and support resilient recovery. Some of the fiscal measures include deferring CIT/BIT and deferring the payment for electricity charges for the industries on a case by case basis. WiFi and electricity will be provided free of charge to the hotels used as quarantine facilities, waiver of payment of monthly rent and other charges for tourism-related business entities leasing government properties will continue until December 2021 are some of the other measures.
The news release states that the government will review the effectiveness of the fiscal measures by December and extend based on the situation of the pandemic.
Close to 140,000 loan account holders are benefitted from the Loan Interest Payment Support under Druk Gyalpo’s Relief Kidu.
Pema Seldon Tshering.
