RPCD. No. PLFS. BC. 1/05.04.02/ 2007-08
Director/Chief Executive Officer
[All scheduled commercial banks (excluding
Regional Rural Banks)]
CIRCULAR - GUIDELINES FOR RELIEF MEASURES BY BANKS IN AREAS AFFECTED BY NATURAL
refer to our Master Circular RPCD.No.PLFS.BC.10 /05.04.02/2005-06 dated July 10,
2006 incorporating guidelines issued to banks in regard to matters relating to
relief measures to be provided in areas affected by natural calamities. Master
Circular for 2007-2008 incorporating the existing guidelines/ instructions on
the subject has been prepared and is appended. The list of circulars compiled
into this Master Circular is given in the Appendix.
Chief General Manager
FOR RELIEF MEASURES BY BANKS IN AREAS AFFECTED BY NATURAL CALAMITIES
but frequent occurrence of droughts, floods, cyclones, tidal waves and other natural
calamities takes a heavy toll of human life and causes wide spread damage to economic
pursuits of human beings in one area or the other of our country. The devastation
caused by such natural calamities call for massive rehabilitation efforts by all
agencies. The State and local authorities draw programmes for economic rehabilitation
of the affected people. The developmental role assigned to the commercial banks
and co-operative banks, warrants their active support in revival of the economic
Since the area and time of occurrence and intensity of natural calamities cannot
be anticipated, it is imperative that the banks have a blueprint of action in
such eventualities so that the required relief and assistance is provided with
utmost speed and without any loss of time. This pre-supposes that all the branches
of commercial banks and their Regional and Zonal Offices will have a set of standing
instructions spelling out the action that the branches will have to initiate in
the calamity affected areas immediately after the requisite declaration by the
district/ state authorities. It is necessary that these instructions should also
be available with the State Government authorities and all the District Collectors
so that all concerned are clear as to the action that would be taken by the banks’
braches in the affected areas.
The precise details in regard to the provision of credit assistance by the commercial
banks will depend on the requirements of the situation, their own operational
capabilities and the actual needs of the borrowers. This can be decided by them
in consultation with the district authorities.
Nevertheless, to enable banks to take uniform and concerted action expeditiously,
particularly to provide financial assistance to agriculturists, small scale industrial
units, artisans, small business and trading establishments affected by natural
calamities, the following guidelines are commended.
Meeting of District Consultative Committee
To facilitate coordination and expeditious action by the financing institutions,
the conveners of the District Consultative Committees of the affected districts
should convene a meeting immediately after the occurrence of natural calamities.
In the event of the calamity covering a larger part of a State, the convener of
the State Level Bankers’ Committee will also convene a meeting immediately to
evolve a coordinated programme of action for implementation of the programme in
collaboration with the State/ district authorities. While determining the quantum
of assistance required by a person affected by the natural calamity, the banks
may take into consideration the assistance/subsidy received by him from the state
Government and/or other agencies.
Special SLBC Meeting
Immediately upon occurrence of a natural calamity, special SLBC meeting may be
convened to review the position in the affected areas and ensure speedy formulation
and implementation of suitable relief measures by banks.
The banks may also give adequate publicity to their disaster management arrangements,
including the helpline numbers. The relief measures initiated and undertaken may
be reviewed periodically in the weekly/fortnightly meetings of specially constituted
Task Forces or sub Committees of the SLBC till such time as conditions are normalized.
8. In order to avoid delay in taking relief measures on the occurrence of natural
calamity, banks may evolve a suitable policy framework in this regard with the
approval of the Board of Directors and forward a copy of the policy note for our
record. It is advisable to provide an element of flexibility in the measures so
as to synchronise the same with the measures which could be appropriate in a given
situation in a particular State or District and parameters in this regard may
be decided in consultation with SLBC/ DCC, as the case may be.
Discretionary Powers to Divisional / Zonal Manager of banks
Divisional/ Zonal Managers of commercial banks should be vested with certain discretionary
powers so that they do not have to seek fresh approvals from their Central Offices
to the line of action agreed to by the District/ State Level Bankers’ Committees.
For example, such discretionary powers would be necessary in regard to adoption
of scales of finance, extension of loan periods, sanction of new loans keeping
in view the total liability of the borrower (i.e. arising out of the old loan
where the assets financed are damaged or lost on account of natural calamity as
well as the new loan for creation/repair of such assets), margin, security, etc.
Identification of the beneficiaries
The bank branches should obtain from the Government authorities concerned lists
of affected villages within their area of operation. From among the identified
persons, assessment of loss sustained by the existing constituents of the banks
would be easier. In the case of fresh borrowers, however, discreet enquiries should
be made in this regard and assistance of the Government authorities should be
sought wherever available for ascertaining genuineness of their requirements.
For providing conversion facilities in respect of crop loans, procedure for identification
of areas where such facilities have to be provided has been indicated under crop
loans in paragraph (g) below.
Each branch will provide credit assistance not only to its existing borrowers
but also to other eligible persons within its command area provided they are not
covered by any other financial agency.
Credit requirements of the borrowing members of the cooperatives will be met by
the Primary Agricultural Co-operative Societies (PACS)/ LAMPS/ FSS, etc. Branches
of commercial banks may, however, finance the non-borrowing members of the co-operative
societies, for which the latter will issue the usual `No objection’ certificates
Immediate assistance including finances would be needed for protecting and rejuvenating
standing crops/ orchards/ plantation, etc. Equally important will be repairs to
and protection of live stock sheds, grains and fodder storage structures, drainage,
pumping, and other measures and operations to repair pump sets, motors, engines
and other necessary implements. Subject to seasonal requirements, next crop financing
should be taken up.
II. Agricultural loans :
The bank assistance in relation to agriculture would be needed in the form of
short term loans for the purpose of raising crops (crop loans) and term loans
for purchase of milch/ draught animals, repairs to existing tube wells and pump
sets, digging of new tube wells and installation of new pump sets, land reclamation,
silt/sand removal, protection and rejuvenation of standing crops/ orchards/ plantation,
etc., repairs and protection of livestock sheds, grain and fodder storage structures,
etc. Banks may, of their own, decide the quantum of fresh loans to be granted
to the affected borrowers taking into consideration, amongst others, the extent
of the crop loss/ scale of finance and their repaying capacity.
Identification of loss
In the case of natural calamities, such as droughts, floods, etc., the Government
authorities would have declared annewari to indicate the extent to which the crops
are damaged. However, where such declaration has not been made, banks should not
delay in providing conversion facilities, and the District Collector’s Certificate
that crop yield is below 50% of the normal yield, supported by the views of the
DCC in the matter (for which a special meeting may have to be convened), should
be sufficient for invoking quick relief arrangements. The certificate of the Collector
should be issued crop-wise covering all crops, including food-grains. Issuing
of such certificates in respect of cash crops, may, however, be left to the discretion
of the Collector. Alternatively, the District Collector, on occurrence
of the natural calamity such as drought, flood etc., may ask the Lead Bank Officer
to convene a meeting of the DCC, and submit a report to the DCC on the extent
of crop loss in the area affected by the natural calamity. If the DCC is satisfied
that there has been extensive crop loss on account of the natural calamity, the
relief including conversion/restructuring facilities of agricultural loans as
per the standing guidelines may be extended to the farmers affected by the natural
calamity, without declaring annewari.
Issuance of fresh loans and restructuring of existing loans
financial assistance required by borrowers in the event of natural calamity would
fresh loans for resumption of normal business
restructuring of the existing loans.
per extant instructions, loans up to Rs. 250/- could be sanctioned to existing
borrowers for general consumption purposes and the limit could be enhanced to
Rs. 1,000/- in the States where the State Governments have constituted risk funds
for such lending. The present limits may be enhanced to Rs. 10,000/- without any
collateral and such loans may be provided even if no risk fund has been constituted.
Further, the limit may be enhanced beyond Rs.10,000/- at the discretion of the
Timely fresh financial assistance to resume productive activities may be
provided not only to the existing borrowers, but also to other eligible
borrowers. Notwithstanding the status of the existing account, fresh loans granted
to the borrowers will be treated as current dues.
(iii) Restructuring of existing
As the repaying capacity of the people affected by natural calamities gets severely
impaired due to the damage to the economic pursuits and loss of economic assets,
relief in repayment of loans becomes necessary in areas affected by natural calamity
and hence, restructuring of the existing loans will be required. The principal
amount of the short-term loan as well as interest due for repayment in the year
of occurrence of natural calamity may be converted into term loan. In case of
term loans the installment of principal and interest due in the year of occurrence
of natural calamity may also be converted into term loan.
The repayment period of restructured term loan may vary depending on the severity
of calamity and its recurrence, the extent of loss of economic assets and distress
caused. Generally, the restructured period for repayment may be 3 to 5 years.
However, where the damage arising out of the calamity is very severe, banks may,
at their discretion, extend the period of repayment ranging up to 7 years and
in extreme cases of hardship, the repayment period may be prolonged up to a maximum
period of 10 years in consultation with the Task Force/ SLBC.
In all cases of restructuring, moratorium period of at least one year should be
considered. Further, the banks should not insist for additional collateral security
for such restructured loans. Asset classification for restructured loans will
remain the same as prevalent at the time of restructuring for a period of one
year as per extant guidelines for restructured loans. The asset classification
status of the se loans will be as under:
The restructured portion of the short term loans and term loans which have been
converted into fresh loans may be treated as current dues and need not be classified
as NPA. The asset classification of these fresh term loans would thereafter be
governed by the revised terms and conditions and would be treated as NPA if interest
and / or installment pf principal remains overdue for two crop seasons for short
duration crops and for one crop season for long duration crops.
The asset classification of the remaining amount due, which have not been restructured,
will continue to be governed by the original terms and conditions. Consequently,
the dues from the borrower may be classified by the lending bank under different
asset classification categories viz. standard, sub-standard, doubtful, loss
Additional finance, if any, may be treated as "standard asset" and its
future asset classification will be governed by the terms and conditions of its
Lending and other norms may be relaxed by banks, at their discretion, for the
Self Help Groups affected in a natural calamity. Similarly, in retail or consumer
loans segment, the banks may restructure the loans in a manner suitable to the
borrowers on a case-to-case basis.
Asset classification of the restructured accounts as on the date of natural calamity
will continue if the restructuring is completed within a period of three months
from the date of natural calamity. The restructured accounts will be governed
by the guidelines applicable to such accounts as contained in paragraphs 4.2.14
to 4.2.16 of the master circular DBOD. No. BP. BC. 15 / 21.04.048 / 2006-07 dated
July 01, 2006. The guidelines applicable to ‘sub-standard’ accounts will apply,
mutatis mutandis, to doubtful accounts.
Other guidelines for providing conversion facilities
i. As far as possible, it would be preferable to prescribe common due dates for
payment of installments of the converted loan and extended term loans.
All short-term loans, except those, which are overdue at the time of occurrence
of natural calamity, should be eligible for conversion facilities.
Pending conversion of short-term loans, banks may grant fresh crop loans to the
Conversion of short-term production loans may be taken up by banks at the time
of sanction of fresh crop loans to the affected farmers without waiting for the
due dates, which are taken into account in normal course of sanction of such loans.
Similarly, installments of principal/ interest in respect of term loans may be
rescheduled for a period of 3 years, which could be extended for longer period
in the circumstances, mentioned at para 15 above.
The rates of interest on the converted loans should be the same as that charged
on short-term loans.
Where relief in the form of conversion/ reschedulement of loans is extended to
the farmers, such converted/rescheduled dues should be treated as current dues
and banks should not compound interest in respect of the loans so converted/rescheduled.
To be effective, the assistance to farmers will have to be disbursed with utmost
speed. For this purpose the lead bank and the district authorities concerned should
evolve a procedure whereby identification of borrowers, issuance of certificates
regarding Government/ co-operative/ bank dues, title of the applicant to land
etc. is secured simultaneously.
Possibilities of organising credit camps, where Block Development and Revenue
officials, Co-operative Inspectors, Panchayat Pradhans, etc. could help finalise
the applications on the spot, could be explored in consultation with the authorities
of the district where such credit camps are being organised. The State Government
will also arrange with the Collectors to issue an executive order enabling the
following officers or their authorised representatives to assume respective duties
and responsibilities as envisaged under implementation of credit camps programme:
Block Development Officer
Revenue Authority/ Village Revenue Assistant
Bank official operating in the area
PACS/ LAMPS/ FSS
Gram Panchayat Pradhan
order to avoid delay, the forms in which the State Government Officers have to
give certificates at the Credit Camps may be got printed in sufficient numbers
by the respective District Magistrates.
In considering loan applications for the ensuing crop season, the current dues
of the applicants to the State Government may be ignored, provided the State Government
declare a moratorium for a sufficiently long period on all amounts due to the
government as on the date of occurrence of the natural calamity.
Scale of Finance
Scales of finance in respect of different crops will be uniform in a district.
The scales will be fixed taking into account the prevailing conditions and norms
presently adopted by different lending agencies. In fixing the scales, minimum
consumption needs of borrowers will be taken into account. The concerned District
Magistrates and Managers of branches of banks operating in the districts would
be advised to adopt the scales so laid down.
Development Loans - Investment costs
The existing term loan installments will have to be rescheduled/ postponed keeping
in view the repaying capacity of the borrowers and the nature of natural calamity
Droughts, floods or cyclones, etc. where only crop for that year is damaged and
productive assets are not damaged.
Floods or cyclones where the productive assets are partially or totally damaged
and borrowers are in need of a new loan.
In regard to natural calamity under category (i) the banks may postpone the payment
of installment during the year of natural calamity and extend the loan period
by one year, subject to the following exceptions:
Those cultivators who had not effected the development or investment for which
the loan was obtained or had disposed of the equipments or machinery purchased
out of the loan;
Those who are income tax payers;
In the case of drought, those who are having perennial sources of irrigation except
where water supply was not released from canals or irrigation facility was not
available from other perennial sources; and
Tractor owners, except in genuine cases where there is loss of income and consequential
impairment of their repaying capacity.
this arrangement the installments defaulted willfully in earlier years will not
be eligible for rescheduling. The banks may have to postpone payment of interest
by borrowers. While fixing extension of period the commitment towards interest
may also be taken into account.
In regard to category (ii) i.e. where the borrower’s assets are totally damaged,
the rescheduling by way of extension of loan period maybe determined on the basis
of overall repaying capacity of the borrower including his repayment commitment
on the old term loans and towards the conversion loan (medium term loan) on account
of postponing of repayment of short term loans and the fresh crop loan. In such
cases, the repayment period of total loan (including interest liability) less
the subsidies received from the Government agencies, compensation available under
the insurance schemes, etc. may be fixed having regard to the repaying capacity
of the borrower subject to a maximum of 15 years, depending upon the type of investment
as well as the economic (useful) life of the new asset financed, except in cases
where loan relates to land shaping, silt removal, soil conservation, etc. Thus
in the case of loans for agricultural machineries, viz., pump sets and tractors,
it should be ensured that the total loan period does not generally exceed 9 years
from the date of advance.
Apart from rescheduling existing term loans, banks will provide to affected farmers
diverse type of term loans for developmental purposes, such as:
Minor Irrigation: Term loans for repairs to wells, pump sets, etc. which are
to be quantified after assessing the extent of damage and estimated cost of repairs.
Bullocks: Where the draught animals have been washed away, requests for fresh
loans for a new pair of bullocks/he-buffaloes may be considered. Where loans are
given for purchase of new cattle or where farmers have bought milch cattle, reasonable
credit may be given for purchase of fodder or feed.
Milch Cattle: Term loan for milch cattle will be considered depending upon
breed, milk yield, etc; the loan amount will include repairs to shelters, purchase
of equipment and feed.
Insurance: Considering the proneness of areas to cyclones and other natural
calamities, the cattle should be insured. Milch animals/ draught cattle should
be branded for identification as also to serve as safeguard against their re-sale
by the beneficiaries.
Poultry and Piggery : For poultry, piggery and goatery, loans will be considered
as per the norms of different banks.
Fisheries: In the case of borrowers who have lost their boats, nets and other
equipment, re-phasing of payment of existing dues may be allowed on merits. Fresh
loans may be granted to them with loan maturity of 3 - 4 years. Loans for repairs
to boats of the existing borrowers may also be considered. In cases where subsidy
is available the quantum of loan should be reduced to that extent. In States where
substantial subsidy towards the cost of boats, nets, etc. is likely to be available,
proper coordination with the concerned State Government Department in this regard
must be ensured. Apart from complying with other norms and conditions for grant
of advances, assistance may be sought from the Department of Fisheries, which
may be expected to take measures, which would enable banks to proceed with financing
for this purpose. The boats should be comprehensively insured against all risks
including natural calamities as far as possible.
It is likely that financial assistance will be required for reclamation of land
covered by sand casting. Normally, sand/ silt deposits up to 3 inches will either
be ploughed back into the soil or removed by the farmers without any need for
financial assistance. Loan applications will, however, be considered in cases
where immediate cultivation is possible and reclamation (removal of sand) is necessary.
Wherever reclamation finance for saline lands is warranted, the cost of reclamation
not exceeding 25% of the scale allowed for crop loan may be advanced along with
the crop loan.
For other activities like agriculture, horticulture, floriculture, betel vine
growing etc., banks will advance loans for investment and working capital under
their existing schemes and follow usual procedures laid down by them. The working
capital finance may be provided until such period the income from the plantation
is adequate to take care of such expenditure.
However, additional need based crop loans if necessary would be given for revitalisation/
rejuvenation of standing crops/ orchards based on individual assessment.
The question relating to procurement and proper arrangement for supply of adequate
quantity of seeds and various types of fertilizers will have to be discussed with
the State Government and District Administration in each district. Similarly,
for the purpose of ensuring adequate irrigation facilities, the State Government
will undertake repairs to Government owned shallow and deep tube wells and River
Lift Irrigation System damaged by floods and other natural calamities. As for
fisheries, the fisheries department of the State Government will make arrangement
to obtain fingerlings and supply them to those who wish to revive tank fishing
with bank finance.
The State Government will have to consider preparation of schemes, which would
enable commercial banks to obtain refinance at NABARD rates for amounts advanced
by banks for the said purpose.
Terms and Conditions
The terms and conditions governing relief loans will be flexible as to guarantee,
security, margin, etc.
the case of small loans covered by guarantee of Deposit Insurance and Credit Guarantee
Corporation, personal guarantees will not be insisted upon. In any case, credit
should not be denied for want of personal guarantees.
Where the bank’s existing security has been eroded because of damage or destruction
by floods, assistance will not be denied merely for want of additional fresh security.
The fresh loan may be granted even if the value of security (existing as well
as the asset to be acquired from the new loan) is less than the loan amount. For
fresh loans, a sympathetic view will have to be taken.
Where the crop loan (which has been converted into term loan) was earlier given
against personal security/ hypothecation of crop and the borrower is not able
to offer charge/mortgage of land as security for the converted loan, he should
not be denied conversion facility merely on the ground of his inability to furnish
land as security. If the borrower has already taken a term loan against mortgage/charge
on land, the bank should be content with a second charge for the converted term
loan. Banks should not insist on third party guarantees for providing conversion
In the case of term loans for replacement of equipments, repairs, etc. and for
working capital finance to artisans and self-employed persons or for crop loans,
usual security may be obtained. Where land is taken as security, in the absence
of original title records, a certificate issued by the Revenue Department officials
may be accepted for financing farmers who have lost proof of their titles i.e.
in the form of deeds, as also the registration certificates issued to registered
As per the recommendations of the R.B.I. report on customer service, banks will
finance the borrowers who require loans up to Rs.500 without insisting either
on collateral security or guarantee for any type of economic activity.
Margin requirements may be waived or the grants/ subsidy given by the concerned
State Government may be considered as margin.
Rate of Interest
The rates of interest will be in accordance with the directives of the Reserve
Bank. Within the areas of their discretion, however, banks are expected to take
a sympathetic view of the difficulties of the borrowers and extend a concessional
treatment to calamity-affected people.
meeting the eligibility criteria under the Scheme of Differential Rate of Interest
should be provided credit in accordance with the provision of the Scheme.
respect of current dues in default, no penal interest will be charged. The banks
should also suitably defer the compounding of interest charges.
may not levy any penal interest and consider waiving penal interest, if any, already
charged in regard to the loans converted/rescheduled.
Artisans and self-employed persons
For all categories of rural artisans and self-employed persons including handloom
weavers, loans will be needed for repairs of sheds, replacement of implements,
and purchase of raw materials and stores. In sanctioning the loan, due allowance
will be made for subsidy/ assistance available from the State Government concerned.
There may be many artisans, traders and self-employed persons who may not have
any banking arrangement or facility with any bank, but will now need financial
assistance for rehabilitation. Such categories will be eligible for assistance
from banks’ branches in whose command areas they reside or carry on their profession/
business. Where such a person/ party falls under the command area of more than
one bank, the banks concerned will meet together and sort out his problem.
IV. Small Scale and Tiny
Rehabilitation of units under village and cottage industry sector, small-scale
industrial units as also smaller of the medium industrial sector damaged, will
also need attention. Term loans for repairs to and renovation of factory buildings/sheds
and machinery as also for replacement of damaged parts and working capital for
purchase of raw materials and stores will need to be provided urgently.
Where the raw materials or finished goods have been washed away or ruined or damaged,
banks’ security for working capital will naturally be eroded and the working capital
account (Cash Credit or Loan) will be out of order. In such cases, banks will
convert drawings in excess of the value of security into a term loan and also
provide further working capital to the borrower.
Depending on the damage suffered and time needed for rehabilitation and restarting
production and sales, term loan installments will have to be suitably rescheduled,
keeping in view the income generating capacity of the unit. Shortfall in margins
will have to be condoned or even waived and borrower should be allowed time to
build up margin gradually from his future cash generation. Wherever State Government
or any agency has formulated special scheme for providing grants/ subsidy/ seed
money, suitable margin may be stipulated to the extent of such grants/ subsidy/
The primary consideration before the banks in extending credit to a small/tiny
unit for its rehabilitation should be the viability of the venture after the rehabilitation
programme is implemented.
Business Continuity Planning
In the backdrop of increased leveraging of technology in banking system, Business
Continuity Planning (BCP) has become a key pre-requisite for minimizing business
disruption and system failures. As a Business Continuity Planning (BCP) strategy,
banks may identify alternate branches for branches located in areas prone to natural
calamities. As per the extant instructions, the Boards of banks are required to
approve a policy on BCP, allocate sufficient resources and provide clear guidance
and direction in this regard to the Top Management. Banks may formulate full-fledged
comprehensive BCP rather than having only Disaster-Recovery (DR) arrangements.
The banks may also focus on keeping the DR site current, to test them comprehensively
and synchronize the data between the primary and secondary sites.
Access to customers to their bank accounts
In areas where the bank branches are affected by natural calamity and are unable
to function normally, banks may operate from temporary premises, under advice
to RBI. For continuing the temporary premises beyond 30 days, specific approval
may be obtained from the concerned regional office(RO) of RBI. Banks may also
ensure rendering of banking services to the affected areas by setting up satellite
offices, extension counters or mobile banking facilities under intimation to RO
satisfy customer’s immediate cash requirements, banks could consider waiving the
penalties related to accessing accounts such as fixed deposits.
of the functioning of ATMs at the earliest or making alternate arrangements for
providing such facilities may be given due importance. Banks may consider putting
in place arrangements for allowing their customers to access other ATM networks,
Mobile ATMs, etc.
48. If the bank’s currency chest branch is affected, the bank may immediately
contact the nearest functioning currency chest branch of any bank which shall
supply currency notes to the affected currency chest, to enable them to supply
cash to the bank branches linked to them under intimation to the concerned RO
of RBI. In case of need, banks whose currency chests are affected, may, under
intimation to the concerned Regional Office of the Reserve Bank, open repositories
for a temporary period, with a view to meeting their day to day cash requirements.
To facilitate opening of new accounts by persons affected by natural calamities
especially for availing various reliefs given by Government/other agencies, banks
may open accounts with –
introduction from another account holder who has undergone full KYC procedure,
b. documents of
identity such as Voter’s Identity Card or a driving license, identity card issued
by an office, company, school, college, etc. along with a document indicating
the address such as Electricity Bill, Ration Card etc. or
introduction by two neighbours who have the documents as indicated in para 5(b)
d. in the
absence of the above, any other evidence to the satisfaction of the bank.
above instructions will be applicable to cases where the balance in the account
does not exceed Rs. 50,000/- or the amount of relief granted (if higher ) and
the total credit in the account does not exceed Rs. 1,00,000/- or the amount of
relief granted, (if higher) in a year.
Clearing and Settlement Systems
To ensure continuity in clearing service, RBI has advised the banks for ‘on-city
back-up centres’ in 20 large cities and effective low-cost settlement solution
for the remaining cities. The banks in a clearing area could meet with a view
to providing flexible clearing services. However, notwithstanding these arrangements,
banks may also consider discounting cheques for higher amounts to meet customers
requirement of funds where clearing facilities have been disrupted. Banks could
also consider waiver fees for EFT, ECS or mail services so as to facilitate inward
transfer of funds to accounts of persons affected by a natural calamity.
Applicability of the guidelines in the case of riots and disturbances
Whenever RBI advises the banks to extend rehabilitation assistance to the riot/
disturbance affected persons, the aforesaid guidelines may broadly be followed
by banks for the purpose. It should, however, be ensured that only genuine persons,
duly identified by the State Administration as having been affected by the riots/
disturbances, are provided assistance as per the guidelines.
issuance of advice to the banks by Reserve Bank of India on receipt of request/
information from State Government and thereafter issue of instructions by banks
to their branches generally results in delay in extending the assistance to riot-affected
people. With a view to ensuring quick relief to the affected persons, it has been
decided that the District Collector, on occurrence of the riots/ disturbances,
may ask the Lead Bank Officer to convene a meeting of the DCC, if necessary and
submit a report to the DCC on the extent of damage caused to life and property
in the area affected by riots/disturbances. If the DCC is satisfied that there
has been extensive loss to life and property on account of the riots/ disturbances,
the relief as per the above guidelines may be extended to the people affected
by the riots/ disturbances. In certain cases, where there are no District Consultative
Committees, the District Collector may request the convener of the State Level
Bankers’ Committee of the State to convene a meeting of the bankers to consider
extension of relief to the affected persons. The report submitted by the Collector
and the decision thereon of DCC/ SLBC may be recorded and should form a part of
the minutes of the meeting. A copy of the proceedings of the meeting may be forwarded
to the concerned Regional Office of the Reserve Bank of India.
Applicability of the guidelines in the case of trade and industry
Instructions on moratorium, maximum repayment period, additional collateral for
restructured loans and asset classification in respect of fresh finance will be
applicable to all affected restructured borrowal accounts, including accounts
of industries and trade, besides agriculture.
Circular - Guidelines for Relief Measures by banks in areas affected by
of circulars consolidated by the Master Circular
measures to persons affected by natural calamities –Agricultural advances
for Relief Measures by banks in areas affected by natural calamities-(Consumption
assistance to persons affected by riots/ communal disturbances, etc.
guidelines for relief measures by banks in areas affected by natural calamities
RPCD.PLFS. BC. No.42 /05.02.02/2005-06
Advisory Committee on Flow of credit to Agriculture and related activities from
the Banking System
on Relief Measures to be extended by Banksin Areas Affected by Natural Calamities
RPCD.PLFS.No.BC. 21 /05.05.02/2006-07
on Relief Measures to be extendedby Banks in Areas Affected by Natural Calamities