Sri Lanka hotels, travel agencies to get 4-pct loan on EPF records: Tourism Authority
ECONOMYNEXT – Sri Lanka’s Tourism Development Authority said a loan at 4.0 percent interest would be given to hotels and travel agencies and restaurants registered under it to pay salaries for 144,000 persons for the next six months
About 124,000 staff with employment records in hotels and travel agencies as well as over 10,000 workers at restaurants, spas, tourist shops and water sports centres could benefit, the SLTDA said.
The funds would be credited by the Bank of Ceylon based on EPF records of employees.
Tourists guides would get a one-off payment that they would not pay back.
The full statement is reproduced below
Detailed list of relief measures given to the tourism industry stakeholders registered with SLTDA.
With the objective of sustaining the lives of approximately 144,000 persons directly involved in the tourism industry and linked to establishments registered with the Sri Lanka Tourism Development Authority, following relief measures have been proposed with implementation mechanisms.
1. Provide a loan at 4% to accommodation providers and destination management companies (DMCs) registered under SLTDA to pay salaries for approximately 124,000 employees through Bank of Ceylon (BOC) without collateral, under the Post COVID-19 Relief budget of the government.
The bank will directly remit salaries up to a maximum of Rs. 20,000/= per employee for six months based on the EPF/ ETF records supplied by the accommodation owners. SLTDA will provide details of all the accommodation providers and DMCs registered under the Authority.
2. A similar loan facility will be made available to pay salaries of approximately 10,000 employees of 850+ establishments providing facilities to tourists, registered under SLTDA including; Restaurants, Tourist Friendly Eating Places, Spa & Wellness Centers, Spice Gardens, Tourist Shops and Water Sports Centers.
The bank will directly remit salaries up to a maximum of Rs. 15,000/= per employee for a period of six months based on the EPF/ ETF records supplied by the owners of the establishments.
3. Eligibility and Conditions for No. 1 and 2.
– All entities falling under above categories registered with SLTDA or whose registration is being processed at the authority are eligible. (including foreign investments/owners)
– Entities who have paid TDL (Tourism Development Levy) will be given 1st preference.
– All loan disbursements will be to employers who have made employee EPF payments during 2019.
– All disbursements will be via Bank of Ceylon (BoC) and will be subjected to a corporate guarantee or personal or independent guarantor acceptable to Bank of Ceylon.
– Until the full repayment of the loan is done, the borrower is required to be registered with SLTDA. Failure to do so would be a breach of covenant.
– All loan disbursements will be remitted directly to employee bank accounts monthly.
– Registered entities who have availed the soft working capital loan during April, May and June 2020 will be eligible.
4. Repayment of 1 and 2.
The interest rate applicable is 4% per annum and this will be a Five (5) year loan with a two-year grace period from the date of disbursement.
5. Tour Guides and Tourist Drivers who are employed per tour basis and not entitled to EPF/ETF, SLTDA would provide one-off payments of Rs.20,000 to tour guides and Rs.15,000 to drivers registered with the Sri Lanka Tourism Development Authority.
These payments would be directly remitted to their bank accounts by the Authority.
6. Instructions to be given to the Ceylon Electricity Board and the National Water Supply and Drainage Board to delay claiming dues from SLTDA registered accommodation providers for period from 1stMarch to 31stAugust 2020 and provide a 12-month instalment plan to settle the cumulative bills.
In the event Electricity and/or Water Bills have been paid during this period, an additional period of credit to be given; to ensure 12 months grace period in total.
7. The Central Bank to issue circular giving instructions to Banks and Financial Institutions to extend the six months grace period given for vehicles leased for tourism purposes to twelve months without considering the existing lease agreement and without default charges during the grace period.