If your income has been hit by the covid-19 lockdown, it might be worth your while to urgently contact your bank to make use of the emergency debt-relief measures that are now available at FNB, Standard Bank, Nedbank, Absa, Wesbank, Capitec, Grobank and Investec.
Most South African banks have now come to the party to assist clients during this difficult economic time. Farmers and agripreneurs can also tap into the targeted relief offered to both personal and business customers.
Thoko Didiza, the minister of agriculture, land reform and rural development, says her department has availed R100 million to the Land Bank to assist farmers under distress. Earlier, Wandile Sihlobo, chief economist at Agbiz, warned that Mzansi’s agri-sector was heavily in debt. He says the total farmer debt in 2018 was at a record R168 billion. About 60% of the debt is with commercial banks, and 29% with the Land Bank.
This leading provider of motor vehicle and business finance says it has implemented “appropriate and ethical plans to responsibly navigate around the current situation and ensure service continuity for all our customers”.
Wesbank provides, amongst others, vehicle and asset finance to the agri-community as well as full maintenance leasing and vehicle stock funding.
According to a media release the interventions will assist clients who have honoured their repayments to Wesbank on a consistent basis prior to covid-19. “The type of relief and the implementation thereof will vary depending on the type of product each customer holds. Interest and fees will continue to accumulate on outstanding balances, but no fees will be charged for any relief granted. Customers who have been impacted are welcome to get into contact with us through their preferred channel to make the necessary arrangements.”
Bennie van Rooy, CEO of Grobank, described the lockdown as a moment of “rapid and unprecedented change”. He says, “While the way in which we interact for the foreseeable future is affected, our service to you will not be affected. Our relationship and partnership with you will continue to drive our shared ambition.”
Grobank operates as a commercial specialist across every area of the agricultural value chain, whilst also offering an expanding range of capabilities and services to businesses outside of this sector.
First National Bank
If you can prove loss of income due to the coronavirus pandemic, you can apply for a debt-repayment break of up to three months. However, FNB will require a letter from your employer confirming that your earnings have taken a blow because of the novel coronavirus. If you’re self-employed you will have to submit financial statements.
A message on the FNB app, however, suggests that the bank will also look into your credit history. The bank told says “…those that are up to date with their commitments and have historically conducted their relationship with FNB and other credit providers responsibly… are those most likely to qualify for one of the various debt relief solutions FNB will offer.”
FNB CEO Jacques Celliers says the possibility of a second phase of debt relief might be considered for those who do not currently qualify. Use the FNB app to apply for a payment holiday across all kinds of debt, both secured and unsecured.
For farmers and agripreneurs, the bank’s website confirms that they offer a variety of finance solutions that “can help your farm run smoothly because we understand the cyclical nature of farming”.
Meanwhile Standard Bank has announced “a second wave” of relief to help clients in navigating all their financial commitments as coronavirus infections continue to spread across the country.
The bank says their assistance comes in the form of a three-month instalment relief for all clients earning R7 500 a month or less who are not in arrears on any of their accounts as at 31 March 2020. Standard Bank says, “This applies to qualifying customers and their associated accounts which include, home loan, vehicle and asset finance, credit cards as well as short term loans. Customers offered the relief will see their interest and bank charges capitalised over the term of their loan agreements.”
The second round of relief comes after Standard Bank’s earlier announcement that it would be instituting an instalment relief for both small and medium enterprises (SME’s) and fulltime students with loans. SME clients with a turnover of less than R20 million were granted a three-month instalment relief on their businesses loan repayments. This has now been extended to include business owners’ personal loans.
Nedbank has encouraged clients who are experiencing cashflow difficulties as a result of the pandemic to urgently contact them. The bank says, “We are specifically looking at ways in which we can address the heightened anxiety of our clients as a result of covid-19 and the negative impact it has had or may have on their finances.”
Several options are offered to clients based on their individual circumstances, “rather than a one size fits all” solution. This could include a payment holiday where you will be offered a temporary suspension of your monthly repayments, or a restructuring that will increase your original loan term.
Nedbank reiterates, however, that their debt relief options are not restricted to certain products and is also available to clients who might not currently be in good standing with the bank.
Daniel Mminele, group chief executive of Absa, says, “We realise that this is a difficult time for our customers and businesses whose financial means are being negatively affected. After careful consideration and engagements with regulators, we are pleased to introduce a comprehensive customer, business and corporate relief programme.”
Mminele urges clients who are able to continue making their payments, to do so “This will enable us to extend these measures to many more who are not in a similar position.”
Eligible customers in need of short-term liquidity relief will qualify for the relief programme that applies to Absa’s credit products. These measures apply to Absa’s corporate, wealth, business bank, private bank and retail customers. Support to corporate and business banking clients will entail solutions based on their unique requirements and operations.
Absa has incorporated a three-month payment relief and allows customers in need of short-term financial relief to reduce their monthly instalments. Clients in good standing (with up-to-date accounts), and who have been financially impacted by the pandemic will have the opportunity to opt-in for payment relief, aimed at assisting with cash flow needs. This means the programme will give them the opportunity to either continue paying if they are in a position to, to pay reduced instalments by agreement with the bank or to defer payments for a period of three months.
South Africa’s biggest bank by customer numbers, Capitec, says, “Facing this global pandemic is a defining moment in history. We can’t change the situation, but we can help change the outcome by choosing how we respond to it. And how we respond to it will not only define our character, but also shape the future for the next generation.”
Selected Capitec branches can assist with essential banking needs during the current lockdown. However, it is still not clear exactly how Capitec will assist clients who have been negatively impacted by the coronavirus blow. A Capitec spokesperson told Fin24 earlier that the bank currently handles credit defaults on a case-by-case basis, using existing policies and procedures.
In an open letter to clients, Fani Titi, the group chief executive of Investec, says, “While covid-19 has changed the ways we live and work, we are here for you. We shall continue to support you while doing all we can to keep our people safe.”
The bank has not publicly confirmed any coronavirus related debt relief measures, but Titi has asked clients to liaise with their bankers should they seek assistance.