The National Bank of Serbia passed a Decision on temporary measures for banks for mitigating the consequences of COVID-19 pandemic for the purpose of preserving financial system stability and Decision on temporary measures for financial leasing companies for mitigating the consequences of COVID-19 pandemic for the purpose of preserving financial system stability, which entered into force on 28 July 2020.

These decisions provided debtors with another delay in payment of obligations to banks and leasing companies that are due in the period from 1 August 2020 until 30 September 2020, inclusive.

Moratorium application

Moratorium shall apply to:

• Obligations of debtors on basis of loans;
• Obligations of debtors on basis of credit products (e.g. current account or credit card overdrafts);
• Obligations on basis of other bank products (e.g. obligations based on credit risk insurance instruments linked with credits and/or credit products or based on bank guarantees);
• Obligations on basis of leasing agreements.

Obligations of banks and leasing companies

Banks and leasing companies are obliged to offer to debtors (natural persons, farmers, entrepreneurs and companies) delay in repayment (moratorium) no later than 31 July 2020.

They are obliged to post the notification on offer for delay in repayment on their website, which will mean that the offer is delivered to all debtors.

Debtors may also be approved other facilities relating to repayment obligations.

During the moratorium, banks and leasing companies will not calculate default interest for unpaid claims that was due during the moratorium, they shall not institute procedure for enforcement or the procedure of enforced collection against the debtors, or any other legal actions for the purpose of collection from debtors, however they shall calculate regular (agreed) interest.

Regular (agreed) interest shall be calculated for undue debt (which does not include the obligations due during moratorium) and exceptionally, if the debtor is a company, regular (agreed) interest shall also be calculated for principal amounts of debt due during the moratorium.

During moratorium on obligations relating to credit cards and current account overdrafts, the banks will calculate regular (agreed) interest for the used amount.

Rejection of the offer

Debtors may reject the offer on each individual credit/credit product/other product/financial leasing agreement, namely:

• Electronically (by filling-in the form on website or e-mail notification to the address published on the website for such purposes);
• By regular mail;
• By phone (the number published on the website for such purposes);
• In business premises by filling-in the forms.

If a debtor fails to reject the offer within ten days after the notice publication, it shall be deemed as accepted and the moratorium shall apply to the obligations due from 1 August 2020 until 30 September 2020, inclusive.

Debt repayment by attachment on salary and permanent order

If a debtor effects repayment through permanent order, banks and leasing companies shall be obliged to immediately inform the bank that effects such payment about the rejection of offer in order not to suspend payment i.e. in order to reactivate permanent order and effect payment to the bank or leasing company.

If repayment of obligations of debtor who notified the bank/leasing institution of rejection of offer is done through attachment of salary, the bank/leasing company shall be obliged to immediately notify thereof the employer i.e. Republic Fund for Pension and Disability Insurance so that the transfer of funds is not suspended.

In case of offer acceptance, employers need to suspend the implementation of attachment of salary for employees’ obligations due from 1 August 2020 until 30 September 2020, inclusive.

This article is to be considered as exclusively informative, with no intention to provide legal advice.
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