BENGALURU : Despite several warnings from the Karnataka Chief Minister, there’s nothing much the police have been able to do to counter the ‘meter baddi’ business, as measures to curb the latter have taken a back seat in city. A recent incident at Banaswadi, where a lady by name Aruna, alias ‘baddi Rani Aruna’, who is a financier in the area and lends money to people with high interest rates, allegedly assaulted another lady's — Girija’s — son Abhiram, for delaying payment of the money.
The City Police claim that this kind of ‘business’, which earlier was mostly limited to vendors in and around Shivajinagar and KR Market, has now become rampant among the middle and upper-middle classes too. “It is extremely dangerous. We have seen many crimes happening around this illegal business in market areas. We were, to some extent, able to curb it, but now, we have been noticing this trend catching up with the middle and upper-middle class residents too,” said a senior police officer.
Some residents, who have been victim to this extortion, claim that they are helpless, as the rate of legal interest for secured home loans is less, but a lot of collateral securities are asked for during sanctioning of the loans. This method, they say, is easier. Sandeep Gowda (name changed), a resident of Chandra Layout, told CE, “I wanted money for my daughter’s wedding.
I approached the bank for a loan, but was asked many questions, and was also asked to submit many documents as collateral. I was left with no option, and so I went to meter baddi Jayamma and got `2 lakh at 20 per cent interest. I am paying `20,000 each month.”
Another resident had borrowed `10 lakh from a small-time jeweller in 2008. He said he repaid `18 lakh towards the loan. “Whenever I approached the lender, he would say I still owe him some money. When I asked him for the accounts, he would threaten me by showing some numbers and calculate that I still owed him `3 lakh. I don't know how these people calculate interest. At this rate, I'll have to repay the loan till my last breath,” the borrower said.
He said he had already lost his house and a car paying off these debts, and the lender was threatening to harm his wife. He approached the police despite knowing they would do nothing, and alleged that they work hand-in-glove with the illegal moneylenders.Meanwhile, ‘meter baddi’ lenders operate on a daily basis too, wherein if a person has borrowed `1,000 for that day from the lender, he would end up paying `1,400 with 40 per cent a day.
“My son’s surgery was in three days. I had no option but to borrow `3 lakh, and now I have not only lost my son to illness, but also had to sell my house to clear the interest money. I have been threatened by goons who are attached to Yashaswini, whom I borrowed money from,” said Nagendra ST, an employee with a private company. Women take overInterestingly, the business, which was once limited to men, is seeing women take charge, say officials from the Central Crime Branch (CCB). Recently, the CCB have reportedly approached all police stations to get a list of such money lenders. In the list received, most people, so far, have been women.
Jayamma of Hennur, Yashaswini of Chennamanakere Acchakattu, Aruna of Banaswadi, Girijamma of Vijayanagar and Indrani of Kalasipalya, are some of the most notorious names on the list, the police said. They said that few people come forward to file complaints. Only recently, cases are being reported, an officer from the CCB said. During recent arrests, police recovered a minimum of 200 blank cheques, blank sheets with borrowers’ signatures, documents such as promissory notes, original property records, and gold and silver jewellery.
No valid licence
Charging such high interest rates is an offence under the Karnataka Moneylenders' Act 1961, Karnataka Money Lenders Rules 1965, Karnataka Pawn Brokers Act 1961, Karnataka Pawn Brokers Rules 1966, Karnataka Prohibition of Charging of Exorbitant Interest Act 2004 and The Prize Chits and Money Circulation Scheme (Banning) Act 1978. Though the Karnataka Money-Lenders Act, 1961, stipulates that a licence is mandatory to run a finance firm, most moneylenders in the city run their business without a valid licence.
Government’s effort to counter ‘meter baddi’
CM HDK will soon introduce ‘Badavara Bandhu’ (saviour of the poor) Scheme to provide financial help to footpath and pushcart vendors, autodrivers and small businessmen across the state, so they can avail interest-free daily loans. In this mobile banking scheme, the vendors can avail loans up to `10,000 as seed capital.