NEWS & ADVICE : CAR LOANS
Defaulter harassed, robbed by SBI recovery agents
By Vaibhav Aggarwal
Jan 12, 2008
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Kolkata: Despite the hard stand by regulatory, judicial and administrative agencies, the terror of recovery agents continues unabated. In a fresh case of loan recovery misadventure, the Hasnabad branch State Bank of India (SBI) has been accused for sending men to a loan defaulter's house in her absence, who later allegedly robbed the defaulter.

Mrs. Biva Ray Chowdhury, a resident of Hasnabad had taken a car loan from the Hasnabad SBI branch and couldn't send the installments on time. She complained that some bank employees and recovery agents went to her home forcibly opened her almirah and took away jewellery worth Rs. 60,000. She launched a complaint with the police on 4 January (Complaint No 165/4/1/2008) and stated that the men ransacked her house while searching for more valuables.

The bank however has a different story, Mr Sisir Mohan,  the manager of the branch denied the allegations and said, "She has to pay Rs 5 lakh. They are cooking up stories to bypass the issue. Our men went to their house to hang a money recovery notice. We will take legal action against them if the money is not recovered. Why should we take any other means to recover the money."

Desperation to meet credit targets, a broker-bank official nexus, or simply a very slack verification mechanism all can be cited as reasons for giving loans to people who don't have the adequate repayment capacity. This incident is a typical example where a lady whose background  and repayment capacity was not checked properly, was given a car loan on which she defaulted within a short period.

Reserve Bank of India (RBI) had issued detailed guidelines on loan recovery agents and their conduct, however bank authorities have their own concerns on the effectiveness of these guidelines since loan recovery is a process, which will inherently involve some coercion. The need for a loan recovery will definitely be reduce to a great extent if the borrower's credentials are screened properly before disbursing any loan to him.


(Comments Posted : 5) Post Your Comments
1. Dear Mr Parag, and Sandeep, when sm Recovery agent comes to ur home and says indecent things abt ur mom and wife, wud u be staring at him. This is democracy and not goondaraj. SBI always has acted as the modern day Shylock, making sure they eat a pound of flesh from their customers. When you dont know whether a customer is gonna pay or not why give them loans. Then increase Interest rates and start torturing them.
Vinod Tawde (Posted: Mar 11, 2011)
2. Strict action must be taken against the bank manager for for sending recovery agents to the defaulters house. Secondly he needs to be severely penalized for falsely claiming that the recovery agents went only to stick a notice and were not involved in the robbery. Legal proceedings needs to be initiated not only against the manager and the recovery agents but also against the bank's chairman and other officials involved for harrassment caused to the defaulter. In no circumstances in the defaulter to be blamed if the bank approved a loan without checking the repayment capabilty
Adarsh Hoizal (Posted: Jul 17, 2008)
3. Investor confidence will go down if we encourage such false FIRs against banks. All this is happening because of the hype created by media over recovery agents. Now defaulters are dictating the terms.
sandeep (Posted: Jan 14, 2008)
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