Banks in Cyprus were flooded with applications for the suspension of the collection of loan instalments until the end of the year from day one – especially from households.
Tuesday was the first day borrowers could file their application to their bank via post, email or fax and tens of thousands quickly did so, insiders told Phileleftheros.
By three o’clock in the afternoon, Bank of Cyprus alone received over 2,000 applications from households and businesses. And the prediction is that a lot more will follow.
Call centres at banks were on fire all day long on Tuesday explaining to customers that the easiest and best way to send an application was via e-mail or fax.
And there were also cases of people whose income has not been affected by the coronavirus outbreak looking to take advantage of the new measure.
Phileleftheros lists certain clarifications for those who have not yet submitted applications but intend to do so:
-Under the decree, a basic condition is that the customer’s facilities were not in arrears for more than 30 day on February 29, 2020. It does not matter whether the loan is categorized by the banks as performing or not as long as it has no delays of over 30 days. However, banks say they will be flexible in cases where borrowers are, indeed, confronted with a real financial difficulty.
-Regarding the submission of an application, it seems that banks will not ask for additional supporting documents proving that revenue or income has actually been reduced. Essentially, those who apply and do not have over 30 days of a delay will be eligible to participate in the suspension of instalments scheme.
-Banking circles said approvals will be given within one to two days only, as there will be no check on the credit worthiness of the customer other than the 30-day-delay.
-If an application has been submitted but the client’s April instalment – for whatever reason – has been deducted from his/her account, then this will be refunded.
Finance Minister Constantinos Petrides on Tuesday told state television that borrowers will have to negotiate restructuring of loans up to €16 billion after the nine-month suspension is over.
He also said that “the legislation approved by parliament ensures that instalments will not be paid immediately but at the end of the nine-month period the borrower will negotiate with the bank how to repay them unless a new directive is issued by the supervisory authorities.”