Millennium Post

PSU banks plan major festive season loans

Banks in the public sector have lined up an array of lucrative schemes for those eager to avail of home, vehicle and other loans during the festive season.

On the first day of Navratra on Tuesday, Punjab & Sind Bank [PSB] launched a 'Festival Bonanza Scheme for Home & Auto Loans'. The Scheme is applicable to both fresh and takeover cases of home and auto loans made during the current festival season, which began on Monday.

Explaining the salient features of the Festival Bonanza Scheme for Home & Auto Loans, Punjab & Sind Bank Chairman & Managing Director [CMD] D P Singh informed that the bank is financing 100 per cent 'On Road Price' of the vehicles under the scheme of auto loans.

The auto loan scheme envisages the longest repayment of up to seven years with no advance EMI while the interest on loans is charged on daily reducing balance. There is no maximum ceiling on the amount of loan & number of vehicles to be financed by the bank. Singh further added that no processing fee is levied on these loans & that the auto loans by the bank carry the lowest EMI of Rs 1,699 per lakh rupees.

He further informed that the loan under the scheme is without documentation charges except for the actual stamp/ revenue expenses and do not entail any prepayment charges. Regarding home loans under the scheme, .Singh stated that these loans entail the lowest EMI of Rs 915 per lakh rupees up to a loan of Rs 30 lakh for 30 years while the applicable margin is only 10 per cent for loans up to Rs 20 lakh & 20 per cent for loans above Rs 20 lakh respectively.

There is also a processing fee waiver of 50 per cent on fresh housing loans and 100 per cent waiver for the takeover category of such loans.

There is a 100 per cent waiver of processing charges for fresh loans in case of borrowers availing housing loans with the auto loan combo, added Singh. The Bonanza Scheme for home loans is for the longest period of 30 years and envisages no advance EMI and prepayment charges while the interest would be at daily reducing balance.

Commenting on the potential of such ambitious loan plans by the public sector banks, several experts said that these would go a long in boosting demand, particularly at a stage when several foreign and domestic bodies have made adverse forecasts about the Indian economy for the rest of the current financial year [2012-13].

'While American financial services company and top credit rating agency Standard & Poor's has expressed adverse expectations about the Indian economy, the International Monetary Fund [IMF] and World Bank have both lowered their growth rate forecasts for the current fiscal,” pointed out an economist in the capital.

‘The Indian economy is in considerable need of steps to propel demand. In this context the loan initiatives being taken by some public sector banks is extremely vital,’ he added.
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