Australia's top banking body extends loan repayment deferral period for four months

Australia's top banking body on July 8 anunced that banks in country will extend loan repayment deferral period from six months to ten months. Australian Banking Association (ABA) on Wednesday said that Australia’s banks will implement a new phase of support to assist customers to get back to making ir repayments, however, it also ded that those who are able to repay ir loans should resume doing so, which would allow support to be directed to those who need it. 

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"A deferral extension of up to four months will t be automatic, it will be provided to those who genuinely need some extra time.  Many customers may need less than four months to eir restructure ir loans or get back into full repayments. Banks will work with customers to find best options to restructure or vary ir loan," ABA said in a media release on July 8. ABA in March h anunced a six months loan repayment deferral period, which has w been extended to up to four months for those who need it. 

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"This next phase of bank support will avoid a 'cliff' for customers in September and give m breathing y need to work with ir bank and get back on ir feet financially. Australia’s banks supported ir customers as country entered COVID-19 crisis and y are determined to support ir customers on way out of crisis," ABA CEO, Anna Bligh said in a statement. 

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Options for borrowers

Australian banks will approach customers who are reaching end of ir loan repayment deferral period and will ensure that y can start repayment whenever possible in next four months. As per ABA, borrowers will get options that include, extending length of loan, converting to interest-only payments for a period of time, consolidating debt, or a combination of se and or measures. 

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