THE Bangko Sentral ng Pilipinas (BSP) is proposing that non-bank financial institutions (NBFIs) grant disaster-hit borrowers a loan repayment grace period of up to six months.
Under a draft circular, BSP-supervised NBFIs, including quasi-banks (QBs), lending companies and financing companies, can implement the loan relief in areas declared under a state of calamity.
It will cover loans current prior to the disaster with principal and/or interest payments falling due from the calamity’s inception date.
“The implementation of the grace period shall be based on mutually agreed terms between the QB and the borrower,” the BSP said, adding that the parties can also agree on a grace period shorter than six months.
“No interest on interest, penalties, fees, or other charges shall be imposed on the borrower during the grace period,” it added.
The central bank said the proposal sought to provide temporary financial relief to affected borrowers while allowing NBFIs to continue supporting economic recovery in disaster-stricken communities.
“These enhancements mirror the relief framework earlier introduced for banks under Circular No. 1221 and are intended to help NBFIs recover faster, support their borrowers and clients and maintain continued delivery of essential financial services during calamities,” it said.
Beyond the grace period, the draft circular encourages lenders to provide longer repayment deferments for agriculture-related loans.
Payments for crop production financing may be deferred for six to 12 months or longer depending on production cycles, allowing repayment schedules to better match harvest timelines and recovery conditions.
The BSP is likewise proposing the temporary exclusion of calamity-affected accounts from past due and non-performing loan (NPL) computations once a grace period or restructuring arrangement has been granted.
The exclusion may apply for up to one year from the calamity to prevent temporary payment disruptions from distorting asset quality indicators.
NBFIs may also restructure loans of affected borrowers without being automatically classified as non-performing, subject to prudent credit evaluation and documentation requirements.
The BSP also proposed the waiver or relaxation of certain documentary requirements for restructuring, particularly for borrowers who may have lost records during calamities.
To ease operational and financial pressures on institutions, the central bank will also allow staggered booking of credit losses and impairment provisions for up to three years.
Other proposed relief measures include the relaxation of customer identification requirements for clients who lost identification documents, temporary adjustments to regulatory reporting deadlines and operational flexibility such as modified business hours or temporary closures in affected areas.
“NBFIs located in affected areas may notify the BSP of any changes in business hours or any temporary closure of branch, extension office, agency or service unit within 24 hours from such change, or as soon as practicable depending on local conditions,” the central bank said.
“Additionally, for NSSLAs (non-stock savings and loan associations), the opening of previously approved service units located in affected areas may be deferred for a period not exceeding three years, consistent with the conditions set out under existing regulations,” it added.