Banks extend loan payment period as deductions mount

Banks are extending loan maturity periods for customers squeezed by increased State deductions such as the housing levy and pension to stave off the risk of mass default on the back of rising interest rates.

The rise in statutory deductions and increased interest rates in line with higher Central Bank Rate (CBR) — now at 10.5 percent, the highest point in nearly seven years—has hit borrowers with higher monthly deductions, putting many at the risk of defaulting on loans.