Aug 12, 2019

Govt. to spend over 1260m to free bank-finance company debts Featured

The government is to spend Rs. 1260 million to free the people of 12 districts who had taken loans from banks and finance companies at very high interest and are caught up in a debt trap unable to pay back their loans.

To save the people of 12 districts caught up in the debt trap

According to the Deputy Secretary of the Treasury A.M.P.M.B. Atapattu, this amount has been released to release the people of the North, East, North Central and Wayamba provinces who had taken loans at exorbitant rates and
were unable to repay their debts.

Three years of Installments paid to 37 banks-finance companies

Atapattu said 37 banks and finance companies will be paid by the government under six installments within three years, adding that the second installment of Rs. 300 million is due to be released by the Treasury next
month. The first installment of Rs. 300 million was presented in Jaffna at a ceremony presided over by the Prime Minister.

Loans below Rs. 100,000 settled

These loan sharks have hounded the rural people and enticed them to take loans below 100,000 and now they are caught up in a debt trap.

Hence, this relief scheme was initiated in 2018 to free these people from 12 districts from this debt trap.

Atapattu further noted that during the past two years the severe drought experienced in several areas further entrapped the people in this debt trap which was a major issue.

The crops of the people in Jaffna, Mulaithivu, Killinochchi, Mannar, Vavuniya, Trincomalee, Ampara, Batticaloa, Kurunegala, Puttalam, Anuradhapura and Polonnaruwa districts had failed for the past five seasons and this initiative would be a great solace to them.

He further noted that while the government would pay these banks and finance companies the installments, the relevant institutions would have to bear the interest costs. Accordingly, these farmers have all been released
of their debt burden by now making them free from debt.