Andhra Bank, a state-owned lender, has started offering one-month salary as loan to striking government employees in Seemandhra region.
According to a senior official of the bank at the head office, all government employees who have salary accounts with Andhra bank will be offered one-month net salary as loan under 'Super Salary Account' and will be recovered in two installments after they get their salary.
"We charge 13.5 per cent as interest on the loan. Instructions have been issued to all the branches to offer these loans. We see good response for the initiative," the official told PTI.
When contacted, a zonal manager of the bank in Seemandhra region said they could not receive exact data on the number of employees who used this facility.
"As there are frequent disruptions on banking services, we are not able to collect data," the zonal manager said.
The zonal officer said they see decline in housing loan disbursements as registrations in the region have come to a standstill for the past two months owing to agitations.
He said as government treasury employees are also on strike, most of the bills payable to contractors are not being paid.
He, however, said there is no decline in recoveries despite the strike.
"As of now, we have not witnessed any major defaults of loans on account of agitations. Recovery of non-corporate loans during the last quarter is, in fact, higher than that of the April-June quarter," the official said.
The agitation has prompted the employees to put in more efforts on recoveries as loans would fall in Non-Performing Asset category, if the repayment is not done for three successive installments, the official explained.