The issue of illegal financiers has come to light after a Standard IX student from the city wrote to Chief Minister Siddaramaiah asking the State government to emulate Kerala in tackling exorbitant interest rates.
Stating that his family has fallen prey to the “mafia of private moneylenders”, the boy recounts two incidents to highlight the issue. Having taken a loan to finance his education, his mother was thrown out of their house in Bantwal after she could not repay in the short time set by the financiers. “They threw us out, and stole items from the house that they deducted from the loan,” he said. There was no action against the financiers, though a police complaint had been filed, he says.
Similarly, after having taken a loan of Rs. 1 lakh to finance the marriage of her only daughter, a woman was persistently pursued by “thugs” hired by the financiers to ensure that she repaid, he said. “When she could not pay the loan back within two months, the interest was hiked and she was threatened,” says the boy in the letter. The boy says that after three years of threats and blackmail, the woman committed suicide.
He says that thousands of people across the State are in similar positions after borrowing money in cases of emergencies — for marriages or hospitalisations. “Nationalised banks and cooperative banks take months to sanction a loan and require numerous documents that the poor may not have. Illegal financiers thus become the only way out for the poor,” explains the boy in the letter, copies of which have been also sent to Home Minister K.J. George and Law Minister T.B. Jayachandra.
Kerala model The boy urged the State government to come out with a stringent law, much like the Kerala government’s Operation Kubera. Victims, he said, can lodge a complaint through a toll-free number, and the police file a non-bailable case against the erring financier.
‘Proof needed’ The issue also came up at a grievance meet here on Sunday, where an activist complained that non-governmental organisations (NGOs) and self-gelp groups were lending money at “high interest rates” in the district.
Superintendent of Police S.D. Sharanappa urged the public to give specific complaints of illegal financiers who can be charged under the Karnataka Prohibition of Charging Exorbitant Interest Act 2004. “Unfortunately, most people borrow money without having sufficient evidence such as a written document of loan or eye-witnesses. If these are provided, then a strong case can be made,” he said.
