SBI launched ‘Kavach’ personal loans for Covid-stressed customers

State Bank of India (SBI) recently launched a new loan offering ‘Kavach Personal Loan’ to provide relief to its customers who are facing financial challenges due to covid related treatment costs.

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Kavach Personal Loan is a collateral-free offering by SBI, under which a maximum of Rs 5 lakh loan can be availed at 8.5 per cent per annum for a period of 5 years.

This unique product is being offered under the collateral-free personal loan category and comes at the cheapest rate of interest under this segment.

This loan scheme by SBI will be under the Covid loan book that the Reserve Bank of India (RBI) had asked banks to create to provide relief to individuals and institutions affected due to covid.

RBI had created a Rs 50,000 crore liquidity window, under which banks were encouraged to borrow at the repo rate from RBI and lend to institutions to strengthen medical infrastructure.

Large banks, with ample liquidity, also have been permitted to use their own liquidity to lend to individuals and institutions under the Covid loan book.