The National Coronavirus Headquarters has decided that banks should not reject checks with non-sufficient funds.
All checks maturing from April 21 to May 9 are covered by the decision, Mohammad Nahavandian, vice president for economic affairs, said.
The measure is in line with government measures to aid businesses hit by lockdowns imposed by the government to contain the Covid-19 outbreak.
“Courts have been asked not to issue injunctions in this period for defaulters until business activity is back to normal,” Nahavandian was quoted as saying by the IRIB website.
Issuing bad checks is a crime in Iran and issuers are fined and penalized.
Nahavandian noted that businesses and shops have not been able to sell their products and apparently cannot meet their financial commitments.
With new infections rising after the fresh wave of Covid-19 outbreak last month, the government announced tougher social distancing measures and ordered inessential businesses to close from April 10. The fourth wave of the disease emerged soon after the two-week Iranian New Year holidays in early April.
Confirmed corona cases in Iran surged above 2.5 million ony Saturday and the infectious disease has so far claimed more than 72,000 lives, according to the Health Ministry.
As per lockdown rules, only essential businesses categorized as Group I, including bakeries, supermarkets, groceries, garages, chain stores, health, medical and treatment centers, pharmacies and printing shops are allowed to open.
In a statement the Iran Chamber of Guilds expressed concern over the economic implications of the surge in Covid-19 cases.
The government had earlier announced relief on check transactions to help businesses hurt by the pandemic. Those measures, however, didn’t oblige banks to stop legal action against issuers of bad checks.
Last December the CBI exempted checkbook holders of bounced checks from some rules related to such checks. The relief exempted defaulters from penalties that restrict their access to banking services, such as getting new checkbooks.
In the month to March 20, the value of bounced checks reached 312 trillion rials ($1.24 billion), up 37.7% on a monthly basis. In terms of volume, bad checks increased 9.5% compared with the earlier month at 763,000, according to the Central Bank of Iran.
Bounced checks accounted for 7.9% of the total number and 12.1% in value of checks drawn in the mentioned period.
An estimated 197,000 checks valued at 157 trillion rials ($628 million) lacked sufficient funds in Tehran Province, accounting for 6.6% and 11.9% in volume and value of the total checks issued in the capital, respectively.
Highlight: The measure is in line with government measures to aid businesses hit by lockdowns imposed by the government to contain the Covid-19 outbreak
