BENGALURU: Revenue Minister Krishna Byre Gowda on Monday directed deputy commissioners to convene a meeting with micro finance firms in their respective districts, along with SPs, and instruct them to follow RBI guidelines for loan recovery.
If they fail to do so, cases can be registered against erring micro financiers, he warned. In several cases, Gowda said financiers lend loans beyond the borrowers’ ability to repay.
They have given loans to the tune of Rs 59,000 crore. “In order to extend it, they have violated RBI guidelines, and are ignoring the borrowers’ capacity while giving out loans, resulting in incident,” he said. The minister informed that the RBI guidelines say a micro financier cannot give loans of more than Rs 2 lakh, but here they are giving loans of even Rs 6 lakh.
“There are cases where they have given loans to 3-4 people in one house, which is well beyond their ability to repay. Financiers are pushing people into a debt trap.
This has to be monitored,’’ he said, adding that the DCs and SPs have to strictly warn micro financiers. Further, Gowda said the Centre has not given any power to the DCs to act against such lenders, which is why the state government now plans to bring this issue under its ambit, so as to safeguard borrowers, and control such illegal transactions and lending activities.