Tamil Nadu CM MK Stalin (File Photo)
CHENNAI: The Tamil Nadu government on Monday issued an order giving effect to waiver of loans taken from cooperative banks on gold up to five sovereigns or less.
The move will cost the exchequer about 6,000 crore. The department of co-operation, food and consumer protection issued the GO stating that CM M K Stalin had, on September 13, announced that the gold loans taken from cooperative banks till March 31, 2021, will be waived off based on certain criteria to benefit the needy.
The DMK had promised to waive off the loans in its election manifesto earlier this year. The government also issued guidelines to identify eligible and ineligible beneficiaries to avail of the waiver.
Among others, if a ration card holder and members have one or more gold loans (gross weight up to 40g) in one or more cooperative banks, they will be eligible for the waiver.
TN govt releases GO on gold loan waiver
Tamil Nadu government, on Monday, released a government order (GO) on the waiver of gold loans where gold weighing five sovereigns were mortgaged in cooperative banks. The department of co-operation, food and consumer protection issued a GO stating chief minister M K Stalin had, on September 13, announced that the gold loans taken from cooperative banks till March 31, 2021will be waived off based on certain qualifications to benefit the needy. DMK had promised to waive off the loans in their election manifesto earlier this year.
The department stated that the waiver of the loan will provide the exchequer 6,000 crore approximately except the part repayment of the loan by some of the beneficiaries.
GO also mentioned a set of guidelines to be followed by the cooperative banks for the waiver process. According to the guideline, if a ration card holder and the members have one or more gold loans (gross weight upto 40g) in one or more cooperative banks, they will be eligible for the waiver. In case of the eligible borrower repaying part of the loan already, the balance loan amount including principal and other interests will be taken into account of the waiver.
Sri Lankan refugees living in the rehabilitation camps will also be eligible under the waiver if they comply with the conditions. GO also listed the ineligible categories like the loans taken after March 31, 2021 are ineligible for the waiver. The gold loan above 40g of gross weight in one or more cooperative banks will not be eligible for the waiver.
The gold loan within 40g of gross weight taken on or before the cut-off date of March 31, 2021 will not be entertained for the waiver if the loan had been closed on or before the release of the GO.
The order also stated that the state government will pay the cooperative banks the principal loan amount and the interest from April 1 till the release of GO.