The Hindu Business Line : Dist administration helps banks recover dues

The number of accounts turning bad could not be ignored. With the assistance of the District Administration, some of the public sector banks initiated recovery drives and managed to pin the defaulters.

COIMBATORE, June 15

THE beneficiaries of Government-sponsored schemes have more often defaulted in repayment of dues to banks. But banks could not ignore the District Level Review Committee's (DLRC) call in achieving the lending targets under these schemes, though both — the Committee and the bankers — realised that the wilful defaulters list was on the rise even if the amounts extended to individual accounts was negligible.

Citing a case, a Canara Bank spokesperson said the defaulter had availed a loan under the Prime Minister's Rozgar Yojana (PMRY) for setting up a tailoring shop and conveniently forgot to repay. He not only ignored the bank's repeated reminders, but sold the shop to a third person, without informing the bank.

When the bank officials knocked on his door, they realised that there was a change in the ownership. The person who had taken over refused to relent to the officials' queries, stating that he had not availed the loan.

An official however identified the defaulter working in the shop. It was understood that he had sold the business for a profit and utilised the money for some other purpose.

He further stated that he was given to understand that the sums lent under the Government-sponsored schemes were generally written off and no questions asked.

With the help of the District Administration, the bank officials managed to recover some amount in cash besides chalking out a time frame for recovery of the principal, if not the interest.

This is not an isolated incident. A number of others have been taking the bankers for a ride forcing them to be overtly cautious in lending.

Such efforts have gone a long way in making good a loss that was otherwise not to be. Thanks to the support extended by the District Administration.

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