The Monetary Authority of Singapore is in talks with lenders about extending the nation’s debt moratorium program beyond Dec. 31 to provide extra relief for borrowers hit by the fallout from the COVID-19 pandemic, people with knowledge of the matter said.
One of the key measures being discussed is the possibility of lengthening the debt relief program, with industries that have been impacted most by the pandemic potentially having aid extended by as much as six months, the people said, asking not to be identified because the talks are confidential.
A tiered approach is being considered, so relief is targeted to those needing the most help, one of the people said.
Details of the plan and what types of borrowers would be covered under an extension are still being finalized, they said.
An extension to the debt moratorium would help mitigate the so-called “cliff effect” on consumers and businesses once relief measures end.
Authorities are using both fiscal and monetary tools to provide support against what might be a record recession that came with the pandemic.
The government last month introduced additional support measures of S$8 billion (US$5.82 billion), bringing Singapore’s total pledged pandemic aid to more than S$100 billion.
They extend to March next year most wage subsidies that would have expired last month, and are tapered depending on how impacted different sectors are.
However, Singaporean Deputy Prime Minister Heng Swee Keat (王瑞傑) has said that the measures would not be indefinite, as they draw heavily on reserves and risk propping up nonviable businesses.
Under measures announced in March, small and medium-sized firms can opt to postpone principal payments on their secured-term loans until the end of the year.
Consumers can defer both principal and interest payments on residential mortgages, and individuals suffering a loss of income can ask for a lower interest rate on unsecured credit.
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