The Central Bank of Bahrain (CBB) has also been asked to encourage the government to support the proposal.
Mr Al Nefaei said the aim was to allow people, businesses and the economy to recover properly from the effects of the Covid-19 pandemic which are still being felt despite positive indicators.
“The deferrals have helped the market and as soon as it stops people will stay home and limit their spending,” he said.
“We don’t want the economy to go back to March 2020; the Cabinet must take a decision on Monday, it is its last session of the year.
The Bahrain Chamber backed the move, from January to June next year, to ensure business recovery continues.
The loans were carried over from March to August last year without bank charges.
They were carried over three more times under optional agreements in which interest was calculated from August last year to December this year.
Isa Al Qadi, one of the MPs backing the proposal, said global markets were already stagnating in 2019 before the pandemic made matters worse last year.
“Loan deferrals were introduced to allow cash flow in the market at a time of uncertainty and declining business.
“It has helped small and medium-sized businesses, but many have unfortunately reached breaking point after being closed for months with no real income like salons, massage parlors and retail and entertainment outlets among so many. ‘others.
“They owed huge sums of money and some were even brought before the public prosecutor; loan deferrals helped them reach settlements.
However, Mohammed Buhamood, another MP backing the proposal, expressed concern over the growing interest.
“Interest has been accumulating since last year and the fear is that this could lead to a future financial crisis in which people cannot pay their dues while loans have to be repaid.
“In my view, deferrals should continue, but banks need to be flexible in the interest they charge.”
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