: The Debt and Debt-Trap Victims Association has sought suitable measures to protect debtors from persecution and strict enforcement of the moneylenders Act to prevent fleecing of poor people by unauthorised moneylenders.
Ravi Varma Raja, president; Victor Noon, vice-president; and Shahida T.K., and A.P. Sujatha joint secretaries of the association, condemned the recent Act that empowers banks to directly take action to recover outstanding loans from defaulters without depending on government authorities to initiate revenue recovery proceedings to recover loan-arrears.
This Act had given extensive powers to banks, including new generation banks, and had enabled financial institutions to force debtors to pay the money, with police protection, the association leaders alleged.
Demanding suitable legislation to protect interest of debtors, the association’s office-bearers advocated introduction of the provision in the Hindu law, known as ‘damdupat.’
According to this provision, interest on outstanding amount of loans should not ever exceed the principal amount even when repayment had not been made.
If repayment of a loan of Rs.1 lakh was not made, the interest-arrears should not exceed Rs.1 lakh. “This provision ensures a fair deal for both the debtor and the lender,” the office-bearers said.
They said the association would campaign for this and similar ways of protecting debtors’ interests and prevent their harassment and persecution.
Such protective measures for debtors had become absolutely necessary since it had become almost impossible to build a house or buy a vehicle without bank loans and, consequently, most people were debtors, the association said.
Debt and Debt-Trap Victims Association wants introduction of ‘damdupat’ A recent Act empowers banks to directly act against loan defaulters
Debt and Debt-Trap Victims Association wants introduction of ‘damdupat’
A recent Act empowers banks to directly act against loan defaulters