The Furniture Manufacturers’ and Merchants’ Welfare Association has appealed to the Union and State governments to intervene and extend the moratorium on bank loan repayment by six months in view of the continuing disruption in the economy due to the COVID-19 pandemic.
The furniture makers say the sector as a whole now face serious financial problems and is not in a position to make payment of interest and compound interest after the moratorium period ended in August.
Those in furniture business fear that their inability to repay the loans will result in a non-payment situation, which in turn will affect the ratings of the borrowers, including merchants and furniture makers, possibly shutting out opportunities for further loans in the future.
The situation is so serious that the furniture-makers will end up with a big crisis in their hands. About 25% of the units are already closed due to the financial crisis facing them and the numbers can go up to about 35% of the businesses if the government does not intervene immediately, says the president of the association Tommy Pulicat.
The furniture makers want the government also to ensure that businesses remain open according to the COVID-19 protocol prescribed by the government.
With little of the stocks being sold ahead of the Onam season due to COVID-19, no fresh stock can be sold or delivered, he adds. Traders have, however, been trying to sell what ever they can due to extreme financial constraints they are facing.
