Lenders require Covid-19 mitigation plans

KUALA LUMPUR: Banks are putting in place a new credit assessment methodology before granting any facility to borrowers, according to Bank Simpanan Nasional Bhd (BSN) chief business officer Mujibburrahman Abdul Rashid.

The banking institutions are now looking at the borrowers’ future strategies especially on how they mitigate Covid-19 related impacts instead of relying solely on past historical data to determine the feasibility of their loan applications.

“We will look at your action plans. Let’s say if there is a second wave of Covid-19, what is your business and marketing strategies that you can put in place to ensure this time around you are more resilient and are you ready for that?”

He said this during a panel session at Domestic Tourism In The New Normal webinar yesterday.

Mujibburrahman also urged local tourism players, whose businesses are impacted by Covid-19, to opt for loan or financing rescheduling and restructuring (R&R).

He said many industry players had the inaccurate perceptions that R&R is an element of default, hence, shun away from seeking that financial assistance.

“R&R is not an element of default but a relief to help business owners to ease their burdens,” he said.

He said seeking R&R assistance would not only help to ease the burden of business operators but also assist in reducing banks’ credit cost to ensure that the entire banking landscape could continue in helping the tourism sector moving forward.

Industries, including tourism which are badly impacted by Covid-19 should seek financial assistance.