Recovery of.bank loans

 Yet another suicide fearing seizure and sale of mortgaged property by a bank has been reported from the state, which is quite unfortunate. I always opine suicide is not a solution to amy problem and wonder why even educated people like Adv Tomy succumbs to this tendency. Has he thought of the surviving family members while running away from the issue , leaving them to settle it? If they can settle, why can't he, i wonder!

More reprehensible is the act of the local people who took a protest march to the bank branch. In a video visual of the protest , a person is seen literally threatening the bank officials with physical harm if any bank official attempted recovery of bank loan through sale of mortgaged security . Waynad district has always been notorious for such stand against the lenders, even pressurising the borrowers not to sign the document revival letters to keep the documents live . I wonder why the bankers and the government take such pressure tactics lying down. Instead of inculcating a culture of prompt repayment of loans taken , which will only help in getting more credits in future, such acts will only prompt the bankers to stop providing credit to genuine persons, which will.noy be a healthy situation . I would appeal to the government to initiate suitable action against such persons who insinuate people not to repay the loans and threaten the officials who try to recover the loan. If individual borrowers faces any financial constraint resulting in loan default he/she should be encouraged to discuss the issue with the banker and arrive at a suitable repayment programme, which will be the right approach. The banks are answerable to the depositors of the bank, whose money they lend to others. As a depositor , will these people agree if the bank says their deposits will not be repaid because borrowers were not repaying the loans?

It is high time the state government and SLBC took serious note of such incidents and initiate action to end such anti bank activities by some miscreants, in the larger interest of the genuine borrowers.

Courts and loan policy of banks

This is in response to a verdict by HC ordering SBI to sanction education loan irrespective of the low credit score of the parent who is the co borrower

While appreciating the concern of the court regarding the availability of education loans to the needy, i regret to observe that the courts stepping into the basic loan policy of commercial banks and directing to take a particular stand is fraught with great risks. One can understand the intervention if the denial is in contravention of the laid down policy. In the instant case, as per the loan policy of the bank, duly approved by the appropriate authority, credit rating of the borrower or co borrower of the loan needs to be taken into account while   considering a loan proposal. Now, as per the court order, parents credit rating is inconsequential as teh repayment of the education loan is to be decided based ' solely on the projected future earnings of the students on employment after education'. This observation will only give strength to the demands of the "education loanees parents' association " which has been demanding waiver of interest, write off of principal etc where the student was not in a position to get suitable employment after studies ! 

The future income is only a hypothetical one (which is conditional) and the bank cannot be sure of this! With the present verdict, the onus of finding a suitable job for the student falls on the banker ,to ensure repayment of the loan, which is ridiculous. I only hope the bank(s) challenge this order and convince the court to get it reversed. The court should have considered the fact that the loans are given out of the deposits received by the bank's from public and not from goverment funds and the bank's have a responsibility to the depositors while deploying their funds as loans.

Sedition and law

It is highly unfortunate that the supreme court has chosen to freeze section 124A of Indian Penal Code dealing with seditious acts. The court has taken this extreme step noting the widespread misuse of the section by the ruling party. 

As a layman i am of the opinion that this act of the court is like throwing the baby along with the bath water ! Instead of initiating action to prevent the misuse of the act, the court has chosen to freeze the section itself which will have wider ramifications, i am afraid. Will it not embolden those extremist elements who are out to destroy the unity and integrity of the country, i wonder.

I sincerely hope better sense will prevail over the judges when the issue comes up for final disposal.