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Your personal finance guide to fight coronavirus

By Naveen Kukreja
April 17, 2020 10:22 IST
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Even as you fight the ongoing health challenge, here are some tips to strengthen your personal finance in the time of coronavirus.

Illustration: Dominic Xavier/Rediff.com.

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Covid-19 has created global turbulence, leading to unprecedented country lockdowns, sealed borders, quarantines, volatile markets, etc. While taking good care of one's health and practising caution to prevent the spread of the disease is crucial, it is also essential for you to make requisite preparations and alterations when it comes to personal finance. Doing so would keep you on a stronger footing to take on any adverse situation.

Step up your emergency fund

A good personal finance habit calls for maintaining an emergency fund of at least six months of your mandatory monthly expenses including your EMIs, insurance premiums and monthly SIP. As emergencies such as job loss, illness, salary delay, etc can strike anytime, funds should be parked in instruments such as high yield savings accounts and ultra-short duration funds.

Doing so would yield you higher returns than regular savings accounts while offering higher level of capital protection features and liquidity than other debt funds. With income uncertainty and economic stress on rise, it would be wise if you step up your emergency fund. Doing so would help lower your dependency on debt during an emergency.

Go digital with payments

In this disruptive phase, you can remain on top of your finances by paying your insurance premiums, EMIs, SIPs, and various other payments digitally. Instead of using cash or cheques for payments, switch to digital payment modes like online banking, UPI, e-wallets, etc.

Going digital will not only enhance social distancing in this situation, it will also save you from payment delays or defaults.

Assess your health cover

Health insurance is one of the best financial instruments one should procure to meet any future medical risks, which includes Covid-19, a 'notified disaster' declared by our country. IRDAI on March 4, 2020 directed all the insurance companies to cover Coronavirus cases and speed up the insurance claims made for the disease.

Based on your insurer, your coverage for health insurance might include post- or pre-hospitalisation expenses, ambulance costs, hospitalisation tests, quarantine expenses, etc. Hence, make sure to buy health policies with adequate cover to protect yourself and your family from steep hospitalisation expenses.

However, remember that health insurance policies taken anew might be subject to a 30-day waiting period, ie, the hospitalisation-related expenses would be covered only after the completion of 30 days from the date of policy purchase.

Continue with regular loan and credit card repayment schedule

Despite the three-month loan moratorium announced by the RBI, existing borrowers should do their best to continue their loan repayments. Only borrowers unable to service their term loans because of the severe impact of lockdown on their cash flows should opt for a loan moratorium.

As those availing the loan moratorium will continue to have interest accrued on their outstanding loan during the moratorium period, the interest accrual will increase their total interest cost.

Credit card holders should also avoid moratorium due to the high interest rate, also known as finance charges, on unpaid dues. These rates can range anywhere from 23 per cent and 49.36 per cent per annum depending on the card type, etc.

Instead of opting for the moratorium, they should convert their outstanding bill into EMIs and thus, repay it in smaller instalments. The interest rate charged on conversion into EMIs is much lower than the credit card's finance charges and their tenures can go up to 5 years.

Here is the comprehensive table, in case you are opting for the moratorium on loans.  

TABLE of Banks/HFCs/NBFCs offering loan moratorium (except credit cards)
NAME OF LENDER DEFAULT OPTIONS HOW TO STOP/PAY EMI
State Bank of India Relief only if customer demands. Automatic relief for those repaying their instruments manually Send email to ask for moratorium in case of loan EMI.
IDBI Bank Automatic relief To opt out of moratorium, borrowers of Home Loans,  Auto Loan, Education Loan, Loan Against Property & Personal Loan by emailing to moratorium@idbi.co.in.
Agri & MSME borrowers can opt out of the moratorium by emailing at covid.optout@idbi.co.in.
Canara Bank Relief only if customer demands Reply to the SMS sent by bank as 'NO' to stop deduction on mobile no. 8422004008.
Send email to retailbankingwing@canarabank.com in case you do not receive the SMS from bank.
IDFC FIRST Bank Automatic relief for rural and agricultural customers. For other loans, relief only if customer demands. However, those whose repayment instruments are not cleared will be automatically considered as availing the moratorium To apply for the moratorium, send sms to 8007010908 or email to help@idfcfirstbank.com
ICICI Bank Automatic relief in case of 2 wheeler loans, business loans, farm loans,gold loans, jewel loans and other loans listed in the Bank's category A loans.For category B loans, such as car loans, home loans, personal loan, education loans, etc relief only on customer demand. Visit bank website for loans eligible and not eligible for moratorium by default.
Send SMS or email to bank accordingly.
UCO Bank Automatic relief. Relief on demand to borrowers having SI/ECS/NACH mandate Approach bank to continue to opt out of moratorium. Customer's with auto deduction mandate should visit branch to opt out of moratorium.
Federal Bank Automatic relief in case of Business loans of up to Rs 5 crore,
Agriculture, Micro Lending and Gold loan. Relief on demand for retail
customers and business loans above Rs 5 crore
Customers having agricultural, micro lending, gold loan and business loans of up to Rs 5 crore can opt out of moratorium by replying to the SMS sent by bank.
Retail loan customers can opt for moratorium by
sending SMS to “8546995577” “OPT<space>IN <space><Last four digits of loan account number>. Those with business loans above Rs 5 crore should contact their Relationship Managers for availing the moratorium
HDFC Bank Relief only if customer demands. However, those skipping repayments will be considered as availing the moratorium To provide your consent for moratorium on loan EMIs call on 022-50042333 or 022-50042211 and follow the instructions or submit your request on the bank's website.
Kotak Mahindra Bank Relief only if customer demands. However, those skipping repayments will be considered as availing the moratorium Send email at pay.later@kotak.comto ask for moratorium
Bajaj Finserv Relief only if customer demands. However, those skipping repayments will be considered as availing the moratorium Send email at wecare@bajajfinserv.into ask for moratorium or login at the lender's website to request moratorium
PNB Housing Relief only if customer demands Avail moratorium through website link, short code SMS at 56161, email and missed call at 8743950000
Indiabulls Housing Relief only if customer demands Avail moratorium through email at covid19emi@indiabulls.com
Repco Home Finance Automatic relief Opt out of moratorium by visiting the website or through email to consent@repcohome.com
Deutsche Bank Automatic relief To opt out of moratorium, term loan customers can send SMS <CONTINUE> to 561615. Working Capital customers have to write their Service Manager or Relationship Manager from their Registered email ID.
Standard Chartered Bank Automatic relief for retail term loans To opt out of moratorium, retail term loan borrowers need to send SMS <<OPTOUT>>space<Loan Account No> to 8693800500
Axis Bank Automatic relief in case of gold loans, KCC loans, Farmer loans, Microfinance loans, Commodity loans, Tractor loans, Commercial Vehicle loans, Construction equipment loans, Business loans and Unsecured overdraft & term loans(Small Business Banking). For other loans relief only on customer demand. Visit bank website for loans eligible and not eligible for
moratorium by default and click the options accordingly.
HDB Financial Services Automatic relief Opt out of moratorium by sending 'NO' via SMS to +919718307888, or by clicking  on the opt out link given on the bank's website or by sending an email at moratoriumhelp@hdbfs.com.
ICICI Home Finance Relief only if customer demands Opt for moratorium by filling the form on the link provided on the HFC's website
HDFC Ltd. Relief only if customer demands Opt for moratorium either by visiting the HFC's website or by going through the link sent  via email or SMS.
DHFL Relief only if customer demands Avail moratorium by communicating your willingness to the company via mail/SMS, letter.
DBS Bank Automatic relief Apply online on the bank's website to opt for moratorium.
Citibank Automatic relief to the retail customers if their loan EMIs or minimum dues are not received.  For institutional and commercial clients, relief only on demand. Personal Loans, Ready Credit, Credit Card and Mortgage customer can also specifically opt in for the moratorium by writing to moratorium@citi.com. Asset Backed Finance (ABF) consumers can specifically opt in by writing in to Customer Care Service Desk (wecare.cfil.india@citi.com)
 
Karnataka Bank Automatic relief Contact your respective branch to continue repayment
IIFL Automatic relief for those who do not pay or their instruments do not get cleared. Customers can also fill the form uploaded on the website on whether they want to avail the moratorium or not.
Hero Fincorp Relief only if customer demands Retail loans : Email to Customer.Care@HeroFinCorp.com from your registered email address to opt in.
Corporate loans: Email to Corporate.Care@HeroFinCorp.com from your registered email address to opt in.
Bajaj Finserv Relief only if customer demands. Those missing
repayments will be considered as availing moratorium
Either email at wecare@bajajfinserv.in  to opt in or click on the link
available on website to raise request to opt in.
Yes bank Relief only if customer demands. Automatic relief for self-help and joint liability groups. Opt in by clicking on the link provided in the SMS received from the bank. In case of non-receipt of SMS or email,  opt in for moratorium benefit by accessing the link available on website. Customer whose mobile number is not updated or registered with bank can register  to opt in by clicking on link available on website.
LICHFL Relief only if customer demands and his
 income/cash flows have been impacted
by the lockdown
Opt in by clicking on the link available on website. You can also mail to consent@lichousing.com
In case of Corporate loans, representative duly authorized by the borrower’s Company/ Firm can mail to consent@lichousing.com to opt in.
Edelweiss Relief only if customer demands Eligible Borrowers of: Loan against Property, Housing Loan,Personal Loans, Salary Advance Loans, SME Secured Loans, Business Loans, Equipment Loans -Opt in through CLIENT LOGIN on website. Edelweiss shall also be sending a link to the registered Email id and mobile numbers of the eligible borrowers for availing the moratorium through opt-in.
Eligible Borrowers of Loan against Securities can write to LAS.Servicing@edelweissfin.com
Eligible Borrowers of all Other Loans- kindly contact your Relationship Manager for making a moratorium request.
ABFL-Aditya birla Relief only if customer demands Opt in by sending SMS ABHFLOPT to 567679
NeoGrowth Relief only if customer demands 1.Reach out to customer care on 18004195565 or 9820655655
2. Mail on helpdesk@neogrowth.in
3. Place request on website link
Fullerton India Relief only if customer demands Those wishing to opt for the moratorium can clicking on the link available on the website. The
moratorium offer and its acceptance might be made either through Email/SMS/
Voice Recording/Physical Document/Digital Document.
Home First Finance Company Relief only if customer demands Contact your Branch for more details or  download the moratorium consent form available on website
Cholamandalam Relief only if customer demands Submit request by clicking on the link provided on the website
Ziploan Relief only if customer demands Email your application to customer.care@ziploan.in with your request for moratorium
PaySense (DIGITAL LENDING PLATFORM) Relief only if customer demands Request for moratorium by clicking on the link available on website
Flexiloans Relief only if customer demands Email on covid19emi@flexiloans.com through your registered email id.You can also fill the form on https://flexiloansofficial.typeform.com/to/p9uJ8v
Fedfina Financial Services Relief only if customer demands. Those missing repayments will be considered as availing moratorium Send email at customercare@fedfina.com to avail moratorium.
Kubiz Capital Relief only if customer demands Email at customersupport@kubiz.in to request for moratorium.
Bajaj Housing Finance Relief only if customer demands Email your moratorium request to wecare@bajajfinserv.in or raise a request on the link provided on website
Early Salary Relief only if customer demands Request moratorium by communicating either on phone, chat or email or any other means provided.
StashFin Relief only on customer's demand To avail moratorium opt for EMI Snooze feature which can be accessed through the lender's App.
Tata Capital Relief only on customer's demand To opt for moratorium, non-retail loan borrowers are required to approach their Relationship Managers. Borrowers of retail loans like Personal Loan, Home Loan, Two Wheeler Loan, Car Loan, Business Loan, Consumer Durable Loan,  Tractor Loan and Loan against Property can opt for moratorium by responding to the link sent by the lender or by visiting the  website.
Equitas Small Finance Bank Automatic relief To opt out of moratorium email at consent@equitasbank.com
DCB Bank Automatic relief Opt out by :
1.Write to us from your registered email id to loans@dcbbank.com.
2. Call DCB Customer Care from your registered mobile/telephone number.
3. Give us a missed call to 8367797039
Bandhan Bank Relief on customer's demand 1.Write a mail requesting the relief from your authorised mail ID to payeasy@ bandhanbank.com as per the format mentioned in the FAQs
2.. Contact your nearest Branch and submit your request.
3.. Contact your Relationship Officer/Relationship Manager and submit the request.
Tamilnad Mercantile Bank Automatic relief Those wishing to opt out of the moratorium should approach the concerned branch
South Indian Bank Automatic relief Those wishing to opt out should send a declaration to opt out to their branch through email or otherwise
Dhanlaxmi Bank Relief on customer's demand Opt for moratorium by:
(i) Through website link www.dhanbank.com/deferpmt.aspx
(ii) E-mail request to : deferpmt@dhanbank.co.in
(iii) Missed call alert to 7829395577 from the registered mobile number of the borrower
Indian Overseas Bank Automatic relief To opt out of moratorium submit a request at the home branch
Indian Bank Automatic relief. Demand on relief to customer's with
automatic EMI deduction.
To opt out of moratorium customer's can visit the bank's website or contact the home branch. Customer's with
automatic EMI deduction need to contact the branch to opt for moratorium.
Suryoday Small Finance Bank Automatic relief Those making EMI payment would be considered pre-payment without incurring any prepayment charges
Fincare Small Finance Bank Automatic relief Opt out by visiting the website OR Call at 1800313313 OR Email at customerservice@fincarebank.com
Jana Small Finance Bank Automatic relief Opt out of moratorium through`any one of these ways:
1. Respond to the SMS sent to you with ‘Opt out’ option from your registered mobile number
2.Call the contact center
3.Approach your bank branch
4.Send an e-mail mentioning your loan account number and ‘Opt out’ option from your registered e-mail addres
Ujjivan Small Finance Bank Relief only on customer's demand in case of MSE, Affordable Housing Loan, Personal Loan and Vehicle Finance Loan customers.
Automatic relief for Micro Banking and Rural Banking (except Kisan Pragati Card product) customers
To opt in for the moratorium, get in touch with your nearest USFB Branch or your Relationship Officer (RO) / Loan Officer (LO) / Sales Officer (SO) or call at the toll free helpline 18002082121 or mail to customercare@ujjivan.com.
Micro and rural banking customers can opt out of the scheme by calling the toll free helpline 18002082121 or contact the nearest USFB branch team.
Capital Small Finance Bank Automatic relief To opt out of moratorium contact your nearest branch

Source: Paisabazaar.com

Do not stop investing

Given the downtrend in equity market indices, many investors have generated negative returns from their mutual fund investments. At such a phase, investors should avoid redeeming their existing mutual funds due to panic selling in equities.

Instead, keeping a long term investment horizon in mind, one must use this opportunity to have an asset allocation strategy and restore their original asset mix.

Investors should consider redeeming their fixed income investments to top their existing as well as new equity investments. Doing so would allow you to buy more units at lower NAVs and reduce their average investment cost.

This would further help you create a bigger corpus when the market recovers, thereby helping you reach your financial goals sooner.

However, in case of lumpsum investments, ensure to make it in a staggered manner as it is difficult to predict the duration and bottom of any bearish phase. Avoid using your emergency fund or your entire short term surpluses while you make your lumpsum investment in equities as financial emergencies during bearish periods may propel you to sell your equity funds at a loss or avail loans at high interest rates.

Naveen Kukreja is CEO and co-founder Paisabazaar.com.

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