Madurai

Private bank auctions pledged jewellery

Seventy-one borrowers, who had pledged their gold jewellery with Bodi Krishna Nagar branch of a private bank in November last, were in for shock when the bank informed them that the valuables were auctioned on May 31.

CSB Bank (formerly known as Catholic Syrian Bank) had announced that it would lend more money for pledged jewellery than other nationalised banks. Hence, many customers, mostly small traders, pledged their jewellery with the bank.

Most of the borrowers, who invested the money in their businesses, could not pay interest due to COVID-19 and lockdowns. The rainfall in the district during December and January followed by rise in COVID-19 positive cases resulted in frequent closure of businesses.

As the State prepared for elections held in April-May, it not only resulted in poor sales, but due to the model code of conduct, people were unable to carry cash. Hence, businesses reported dull sales. Meanwhile, the bank sent in a final call of notice to borrowers about public auctioning of their valuables.

A couple, Nagarajan and Priyanka, said they had pledged 165 gm of jewellery and borrowed ₹6.50 lakh. “The bank informed us that the loan to be paid was ₹7 lakh. At a time when we are unable to pay the interest, the bank’s notice to redeem the jewels came as a shock,” they said.

However, when they approached the bank after making alternative arrangements, the manager said they had already initiated action.

Like them, many other borrowers, who had turned up at the bank branch, said the State government should intervene and help them redeem their jewellery. Many traders in Bodi, who had pledged their jewellery, said when they approached the bank manager, they simply refused to give permission for a meeting under the pretext of following SOP in view of COVID-19.

When contacted by The Hindu, a bank official, requesting anonymity, said it was a gold loan given to borrowers with due intimation/reminders to pay the interest and redeem the valuables. The bank followed the laid out procedures only.


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Printable version | Aug 3, 2021 3:49:19 AM | https://www.thehindu.com/news/cities/Madurai/private-bank-auctions-pledged-jewellery/article34718765.ece

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