Humanize RBI Guidelines For Kashmir
SRINAGAR – Expressing concern over the attitude of valley-based banks towards their borrowers, the Kashmir Economic Alliance (KEA), Sunday asked them to understand their social responsibilities in the turmoil-hit region.
In a statement, the KEA spokesman, while appreciating the commercial considerations of banks, said the banks seeking private deposits and businesses had not only to extend services but also understanding their social responsibilities and live up to the expectations of people.
He said although repayment and settlement systems were well laid down procedures, but they also needed to be guided by realities on ground.
Kashmiri businessman in general has remained committed in his obligations towards lenders especially so to the lending banks. This in spite of the hardships he has been facing over the past 22 years and particularly during 2008,2009 and 2010, he may have got a couple of years respite in between but generally his business has suffered. Business community of the valley in general has suffered immense financial losses, in particular tourism, trade, transport and industry, he said.
However, the difference between a willful defaulter and a borrower in trouble has to be determined clearly, as most of the business community in Kashmir are borrowers in trouble and not willful defaulters, the past 20 years including 2008,2009,2010 have been a big catastrophe, bringing business fraternity virtually to a state of trauma, yet the same business fraternity of the valley paid interest on their borrowings to the banks and financial institutions, the spokesman said.
He said credit counseling would eliminate the trust deficit. Weak and vulnerable businesses have to be given more time and confidence to succeed. Interest rates have to be guided by the present and past realities and not on future expectations particularly in vulnerable areas. To persuade borrowers for recoveries might be within the domain of the banks but the manner in which recoveries are made have attracted controversy and invited criticism and violence at times, he said.
The spokesman said the RBI guidelines for Kashmir had to be more rational and humane. Having stated the plight of business community of the valley, financial institutions and banks have never come to the rescue of their business partners. They rather charged them exorbitant rates of interest thus strengthening only their own institutions at the very cost of their business partners, he added.
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