FINCA Bank is offering a special grace period to those customers whose businesses and incomes have been adversely affected by the current situation in the country. This announcement was made on the 19th of March.
We would like to emphasize that the bank has always offered support to its customers and will continue to offer to support its customers throughout the current health crisis. Prior to the COVID-19 pandemic, it was our usual practice to approach individual customers and offer impactful solutions to their problems.
It is important to note that the above-mentioned grace period was interpreted by many to mean that no interest would be accrued – a so-called “zero interest accrual period”. However, this is not correct. It is important to note that during the grace period the inflow of cash and funds decrease, while the bank’s operating costs remain unchanged. As such, borrowers have their liabilities and at the same time banks have their financial liabilities with regard to their employees, depositors, shareholders, international financial organizations. These liabilities have not been suspended. There are many circumstances to be taken into account and of course it requires that the right financial decisions are made to ensure that the impact of the current crisis is less painful for both customers as well as the entire sector.
FINCA Bank is offering a grace period to those customers whose businesses and activities or incomes have been badly affected.
Why three months and not more or less?
We are taking an approach that views each customer individually. We are providing individual solutions to individual customers. This allows us to consider each case separately and provide solutions tailored to each customer’s specific needs and the current situation. We are cognizant that our strategy, approach and the decisions we make made today may not be popular at first glance. However, in the long-term, we believe it will have positive impact on the financial welfare of our customers and sustainable development of the sector as a whole.
In the period of March 19-25, FINCA Bank received about 9,000 applications from customers requesting the special grace period. Each application was studied individually, and the process required a tremendous amount of effort and resources. Here again we would like to underline that the bank studied each case individually and assessed each customer’s ability to pay. We took into account the impact of the emergency situation and all decisions were carefully prepared.
As a result of the bank’s responsible banking policy, the efforts and resources spent on promoting a savings culture, as well as all financial literacy activities carried out over the years, many of our clients have been able to cope with their financial liabilities and responsibilities despite the ongoing situation in the country (many clients had dual incomes, so they were not dependent on one income source and other clients have savings they can use for their ongoing expenses).
FINCA Bank Georgia is taking all measures to ensure respectful and timely support to its customers, entrepreneurs and to ensure the smooth operation of all services the bank provides. How we all overcome the crisis depends on the decision we make and execute today. We are dedicating all our resources and applying our international best practices to make this happen.