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A better mechanism to recover bad loans and effective dealing with the high volume of defaulters is the need of the hour, said CH Venkatachalam, General Secretary, All-India Bank Employees Association.
Speaking to Business Line on the sidelines of the 8th State Conference of Canara Bank Employees Association held here last week, the AIBEA General Secretary said, “The setting up of five more Debt Recovery Tribunals would not make much of a difference in loan recoveries.
“As many as 840,000 cases were pending before the Lok Adalats last year and around 13,400 cases before the DRTs; the number of cases pending under the SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) Act was over 190,000. This has been the enormity of bad loans and the amount involved has been estimated at ₹68,100 crore.”
“We need fast-track courts, further amendment to the recovery laws and amendment to the Peoples’ Representation Act for better recovery. Unfortunately, restructuring route is utilised to camouflage the real extent of bad loans and punitive action not initiated against chronic loan defaulters,” he alleged.
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