Chennai, April 28 : With Covid-19 related lockdown in different parts of the country affecting production and sales, micro and small scale units are pleading for interest waiver, moratorium and lending against credit guarantees. An official of a public sector bank preferring anonymity told IANS that if the government does not come out with a package, then the non-performing assets (NPA) of the banking sector are set to surge ahead this year. "Already 40 per cent of our member units are sick for want of working capital and raw material. Further the increase in raw material prices have hit the units hard," Tamil Nadu Small and Tiny Industries Association (TANSTIA) President S. Anburajan told IANS. He said many units supply the products to public sector units (PSU) and government utilities and are penalised for delayed supplies. "We would like the PSUs not to penalise their small sized vendors for delay in supplies during the pandemic period. There should be a moratorium for loans and interest could be waived for the small units," Anburajan added. Demanding delinking of medium units from micro, small and tiny units, TANSTIA past President V.S. Narasimhan told IANS: "Banks should be made to lend against credit guarantee rather than collaterals. The government should also infuse additional capital into the Deposit Insurance and Credit Guarantee Corporation so that banks have the confidence to loan, based on the credit guarantee." "Countries like the US and Japan have big hearts for small units. In most of the other countries, loans are given against credit guarantee and not collaterals," he said. Narasimhan also demanded waiver of interest by the banks for small units. He said small industrial units have to run their units failing which they would be losing their workforce (mainly migrant workers), customers as well as vendors and regaining them will be difficult. Bankers are worried about the impact of Covid-19 second wave on the economy. Tamilnad Mercantile Bank Managing Director and Chief Executive Officer K.V. Rama Moorthy said he is apprehensive about how it would pan out and whether there may not be another countrywide lockdown. With Covid-19 vaccination, the situation would improve and it is for the Central government and the RBI to decide on loan moratoriums for micro, small and medium enterprises (MSME), he said. /IANS