Banks in Odisha to give small ticket loans up to Rs 1 lakh to Fani victims

Lenders advised to follow Kerala model by accepting minimum documents for providing consumption loans

Taking a leaf out of Kerala's book, the banking fraternity in Odisha has agreed in principle for providing consumption loans to the tune of Rs one lakh to the people affected by cyclone Fani.

“The Kerala structure of providing consumption loans has been approved at the ‘special’ State Level Bankers Committee (SLBC) meeting held as the situation is grim in Odisha due to Fani. The Rs one lakh consumption loan will help in bringing the people of the state back to normalcy”, said an official.

Under the Kerala model adopted during the floods that ravaged the coastal state in 2018, the loan was provided at the rate of nine per cent interest and the burden of repayment of interest was shared by the state government. The beneficiaries were entitled for repayment of principal amount of the consumption loan only.

Banks will take the approval from their respective boards on granting the consumption loans, he added.

The SLBC meeting held on Friday was attended by Chief secretary Aditya Prasad Padhi, AK Goel, chief executive officer of UCO  Bank and chairman of SLBC, Ashok Meena, Finance Secretary, Odisha and PKC Dash, SLBC convenor, BP Kanungo , deputy governor, RBI and other senior officials of the banks.

“Banks have been advised to follow the Kerala model by accepting minimum documents required for providing loans to the affected persons with a slight modification,” Ashok Meena, principal secretary finance said.

The extremely severe cyclonic storm Fani that pounded the state on May 3 had brought the normal banking operations in Odisha to a standstill as the bank branches were without supply of power and internet connectivity.

Meena said that normal banking operations in all the cyclone-hit districts of Odisha will resume by May 13 (Monday). The banks have also been advised to provide services on holidays.

SLBC has taken the decision of restructuring of crop and MSMEs (micro, small and medium enterprises) loans in the aftermath of cyclone.