SBI offers KAVACH personal loan for meeting expenses related to COVID-19 treatment on or after April 1, 2021. This loan is offered to existing salaried, non-salaried customers of the bank.
New Delhi: In the month of May this year several public sector banks announced to provide personal loans of up to Rs 5 lakh to individuals to meet expenses related to Covid-19 treatment of self and family members. This was as part of the COVID relief measures announced by the Reserve Bank of India in early May in the wake of the second wave of the pandemic that has swept across the country unleashing untold miseries on families across income groups.
These loans are offered at concessional rates starting from 6.85% to salaried individuals, non-salaried and pensioners. The minimum loan amount that can be availed under this facility is Rs 25,000 and the maximum loan amount can go up to Rs 5 lakh. The repayment tenure is 5 years and banks will not charge any processing fee on these loans. To avail these loans, borrowers have to give an undertaking that the funds are required for meeting COVID treatment expenses. Banks also ask for a COVID-positive report from customers taking loans for treatment, on or after April 1, 2021.
Here are the terms and conditions of COVID personal loans offered by PSU banks:
State Bank of India (SBI)
SBI offers KAVACH personal loan for meeting expenses related to COVID-19 treatment on or after April 1, 2021. This loan is offered to existing salaried, non-salaried customers of the bank. Pensioners drawing pension from the bank can also avail this loan. There are no foreclosure charges in this loan and these loans can be repaid within five years. The minimum loan amount is Rs 25,000 and the maximum sum is Rs 5 lakh. SBI has said that it will charge 8.5% interest on these loans.
Punjab National Bank (PNB)
PNB markets its COVID personal loans as PNB Sahyog RIN COVID. This loan is offered specifically for the treatment of self or family members affected by COVID on or after April 1, 2021. However, PNB offers this loan to all government or private salaried individuals having their salary account with the bank and drawing a regular income for the last 12 months. The maximum loan amount can be six times the average of the last six months’ salary credited in the account subject to an upper cap of Rs 3 lakh. Interest rate on this loan will be 8.5%.
Bank of India (BOI)
BOI also offers its COVID-19 personal loan only to customers drawing a salary through the bank and to all existing personal and housing loan customers. The maximum loan amount is capped at Rs 5 lakh and the maximum tenure of the scheme is three years, including a six-month moratorium. During the moratorium period, borrowers are not required pay any instalment to the bank but interest will continue to accrue. Interest rate on this loan is linked to repo rate with monthly recast. At present the bank is charging 6.85% interest on this loan.
Bank of Baroda
Existing borrowers of personal loan, home loan, loan against property (LAP) and auto loan from Bank of Baroda can avail of its COVID personal loans. Secondly, the customer should have stuck to the bank for at least six months and should have paid a minimum of three months’ instalments already. Customers can avail 10% of the sanctioned limit of an existing and on-going home loan or LAP and 20% of the sanctioned limit of the auto loan as COVID personal loan subject to the maximum limit of Rs 5 lakh. The interest rate that will be charged is BRLLR (Baroda Repo Linked Lending Rate) + SP+ 2.75% per annum with monthly rest.
