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Use of Force by Banks to Recover Loans

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Nehal said: (Fri, Jul 18, 2014 04:16:12 PM)    
 
This is true that bank should verify all data before giving loan, and bank actually does it. But there are many people who provides wrong information and after giving loan, they not even think about to repay the loan. For these kinds of people, bank should surely take strict action.

But many of people who all are not in condition to repay the loan, as they are in crisis, not having money. So according to my view, before taking strict actions, bank should find out what is the reason behind not repaying the loan. Bank has power to take money back and has responsibility to provide loan to others also.

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Yescole said: (Tue, Jun 10, 2014 03:45:38 PM)    
 
Bravo guys!

Why should someone opt for what he knows he has no capacity to do? monies kept in banks belong to other institutions and people. If for some reason Mr. A who needs financial help asked a bank to so do and the bank granted his request, has the bank done something out of the way? Don't forget that banks do assess their individual customers and the collateral they provided by the banks credit department. It is important to note that banks do not immediately seize a defaulting customer's property without thorough follow ups and warning.

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Yescole said: (Mon, Jun 9, 2014 09:17:51 PM)    
 
Bravo guys!

Why should someone opt for what he knows he has no capacity to do? monies kept in banks belong to other institutions and people. If for some reason Mr. A who needs financial help asked a bank to so do and the bank granted his request, has the bank done something out of the way? Don't forget that banks do assess their individual customers and the collateral they provided by the banks credit department. It is important to note that banks do not immediately seize a defaulting customer's property without thorough follow ups and warning.

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Kamod Chaudhary said: (Sun, Mar 9, 2014 10:08:30 AM)    
 
The bank has no right to send goons to the customer's door. The banks take collateral which is more and less same as the amount they are lending to the customer. The collateral may be the insurance policy or deposits of the customer etc so the bank always has option to confiscate these assets and recover their money.

And if the banks fail to check their customer's credibility thoroughly at the time of sanction of loan then its the bank's fault it should not harass the customer for its own fault.

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Ritu Raj said: (Thu, Jan 23, 2014 06:01:48 PM)    
 
Hi in my view banks have every right to recover the loan by selling the mortgaged property and other assets of the wilful defaulter as banks money is of public money and if loans will go to be bad in higher scales banks will default in payment to its depositor and ultimately whole financial system will collapse.

Thanks.

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Pankaj Singh said: (Sat, Jan 18, 2014 09:45:13 PM)    
 
Whenever bank provide loan to the borrower then bank get the assurance about that borrower that what the person do and what assets they have. Then a bank decide to give him a relevant money that he could return to the bank. If somehow the borrower fail to pay money then bank send there agent to know the problem. Then again the borrower will get some more time by bank to pay the money. If the same think is happening again and again then bank will take a strict action against the borrower.

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Naveen Kishore said: (Tue, Jan 7, 2014 10:18:25 AM)    
 
Today banks are providing loan like it is an primary function of this. He has to understand this that this function is also an harmful function of it. Regarding to recovery of loans I use to say that if banks mortgagee property then why it don't go legal activity because if bank give service then it has right to go legal. For recovering its assets.

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Sri Ram said: (Mon, Dec 16, 2013 10:39:49 PM)    
 
Through the.

All discussions in my opinion bank before going to give a loan ask a security for that person or ask a surety. Maybe He does not have any property but he knows some person to sign as a surety.

That is very easy to both bank and customer. Because bank rule is same as to everyone.

Bank give a loan from customers money so bank have a need to repay the customers money back and bank can't say the reason of loanly people late to give the customers money. For that bank have a permission to repay the loan by violent activities when at a critical condition.

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Harshit said: (Mon, Dec 16, 2013 06:55:39 PM)    
 
According to me banks really should not use forcible things to recover the loan. Banks should assess the condition of the borrower, why he was failed to pay the loan. On this basis banks should decide what to do to take back amount, whether he should be given second chance or some relaxation in terms, and if loan was not being paid intentionally then bank can use whatever it thinks like seize the property, etc.

Most of the population don't consider terms and condition regarding loans that's why they have to face problem while repaying the loan.

And agents sell the loan with making fool the bunches of people knowing the facts that if they will not repay the loan there are lots of way can be used to recover the loan.

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Melvin said: (Sat, Nov 23, 2013 08:17:41 AM)    
 
If customer could not pay the loan and now many years passed and would like to make settlement whatever the money has as per the his capacity. Is is possible?

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Akriti said: (Thu, Sep 26, 2013 10:37:53 AM)    
 
Banks requiring to use force to recover loans is an indicator that its credit appraisal process is faulty. It is not continuously monitoring the lender if the funds are being used for the specified purpose. So, it is better to improve their credit appraisal process than to resort to violent activities to recover loan, which is also prohibited by law.

Even if one defaults they can always approach the court and go by the legal route.

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Latiff Javeid said: (Thu, Sep 12, 2013 10:43:35 AM)    
 
I am not agree with that banks are offering loan like selling vegetables, because every banker has responsible to describe their bank status to their superiors. In which, they have maintain some amount of scale to providing loans to their customers. In this case not every customers are eligible to obtain the loan as per terms and conditions and their repaying capacity. It is very important to maintain their financial scale status.

The bank are very clean to offer the loan to the selective customers due to the below poverty line customers. They only offer loans based on their repaying range. They can study their customers well with their documents but document should be check well and problems are started from here only if it is clean documents the cheaters can control we can also legally use force to control the cheaters documents and their source for paying back to the bank.

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Mark said: (Fri, Sep 6, 2013 05:00:09 PM)    
 
According to my view the bank are generally give the loans to the people who all are having the good salary in the sense of as per bank limited salary and her property. So there is no need to force to recover loans. But some situation people are not pay the loans so they supposed to force to recover loans the conclusion is they have rights to force to recover loans.

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Deeksha said: (Wed, Sep 4, 2013 12:19:31 PM)    
 
Hello friends.

Someone take the loan only if he need the money and he has not other resource to get money.

But we have to give back that money to the bank. That is the rule of this business.

And according to me the rule is rule and it is same for everyone. So, if some one can't give the money back, then bank can use the force to get the money back.

But also, sometimes there may be some valid reasons not to give money back. For example, a farmer had taken a loan and now, he is not able to pay back because of the loss.

In this case, the bank should not use the force.

But if someone wants to cheat the bank and intentionally don't want to pay back, that the bank need to use the force.

So in my point of view, if someone is not paying the loan back, then first, the bank should find out why the person is not paying back, after that it should be decided whether to use the force to get the money back or should extend the time.

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Neelam Yadav said: (Sun, Aug 18, 2013 08:21:59 AM)    
 
Hi frnds, I think that we can not say it wrong as before giving loans to it's customers bank goes through the process of knowing their capability to repay it. As instructions given by rbi in KYC norms. And if after that customers are not paying back it to banks the bank can go by force to recover it. Because it is the need of business. And if bank will not do it then everyone will try to absorb the loan without repaying it.

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Mujffar Ali said: (Sun, Aug 4, 2013 12:14:49 AM)    
 
In my opinion it is not good to use force to recover the loan because its not necessary that every person who is not paying his installment is cheating with bank there may some serious problem with that or maybe he or she is suffering from a big loss in their business in which they invest their loan amount. I am not saying that bank always should not use the force but first bank should come to the reason why he or she is not paying his or her installment after that if reason is not acceptable then it can use force to recover the loan.

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Charu said: (Fri, Jul 5, 2013 07:29:25 PM)    
 
I'm not agree with this. Because in that situation person need money from bank to start any business and they have the plan to get profit and return back the loan money to bank, but in bad situation they got loss in their business and not able to return back the money. So, bankers should give time to them. This is my thought. Because now a days many students doing their studies with bank loans. So please put trust on them and help everyone, then they will be truth to bankers.

Thank You.

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Ramana said: (Wed, Jul 3, 2013 01:12:06 PM)    
 
I accept the fact that there is some amount of fault with the bank but people ? are they very correct in what they are doing ? If you know that you will not be able to pay the amount why do you have to get the loan. In cases where something backfires unexpectedly I can understand but there are people who deliberately get loans and avoid paying them back and the bank has to take some step as money is in stake. So the fault lies with both I'll say. The bank should act responsibly while giving loans and so should citizens applying for loans.

Banks these days are selling loans like vegetables to feed the profit hungry shareholders and then using all kind of tactics like sending goons to recover the money. This is not acceptable to any society. India is a country where nearly 40% are living in extreme poverty and other 25% are just above this poverty line. They will accept any kind of loan without even considering its terms and conditions. My point is the banks must ensure the repayment capacity without exception before approving loans. This is also critical to the reputation of not just Banks but the whole financial system.

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Samar said: (Wed, Jul 3, 2013 11:46:40 AM)    
 
The use of force by the banks to recover debts from the defaulting debtors is nothing but collecting money through violence. And, any resort to violence is a crime prohibited by the laws of the land. Do the Banking Regulation Act and the allied legislation provide for such course of action to protect the banking industry? If not, the banks resorting to this kind of practice are certainly doing illegal acts that must not be allowed to go without impunity.

The logic behind such course of action cannot be endured even on economic grounds why the banks should move ahead recklessly with the depositor's moneys to dump them into unworthy hands? Why would they not arrange for adequate security against the loans they extend to risky ventures? They must remember that they stand in a fiduciary relationship with their depositors and thus stand as trustees of the properties of the latter. And no rational depositor expects that his or her banker applies violence to guard his or deposits.

The present picture reminds one of the facts and legends of the moneylenders who used to ravage the lives of the masses in the countryside during the earlier days although many instances are sometimes reported even these days. How one can forget in this context the unforgettable Shylock of the drama The Merchant of Venice by Shakespeare, the Great who made usury an art by resorting to cruelty. One may even be amazed at the sobriety of the kabuliwallas i.e. the Afhgan moneylenders vis-a-vis the rowdiness of the so-called 'modern' bankers.

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Abhishek said: (Fri, Jun 21, 2013 12:25:53 AM)    
 
All of you who are criticizing banks for their stringent action towards defaulters. Can you please imagine going to a bank for breaking your fixed deposit or withdrawing from your savings account, and the banker says that we don't have money to repay you, since your money which we lent to a borrower, is not in a position to repay.

How you will feel? Rightly said by someone amongst you that bank is just an intermediary, which accepts deposits for the purpose of lending. And unless the borrower repays the loan back, how a bank is supposed to repay its depositors? Almost all the borrowers, who claim that they don't have the money to repay their loan, when someone in their family has to get married or someone falls sick, how they arrange money for those things?only because they find those things important.


And since they don't consider repaying their loans important, they are not able to arrange money for it. Are banks supposed to keep running from door to door for recovering their loans? someone suggested that there are legal courses of action available. And of course that takes time. So are you ready to get money of your matured deposit after five or ten years of its maturity, since the amount is stuck somewhere else? Its very easy to talk about system and procedure, but when we are at the receiving end, we ourselves don't remember that any such thing actually exists.

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Subahan said: (Tue, Jun 18, 2013 08:10:54 PM)    
 
Hello friends.

I completely disagree the statement. Banks are giving loans to people after verifying the certificates related to their income, property and for what purpose they are taking the loan, if the bank was satisfied with those documents then only the bank ll give the loan. So if the person who took the loan unable to return the money to the bank, the bank had right to sell the property of the person and fill their loan money, but they are not having the right to force the person to return the loan. Force on the person to pay the loan is violation of bank rules. So use of force by bankers is wrong statement.

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Vaishu said: (Thu, May 30, 2013 07:40:20 AM)    
 
Hello friends,

Your point of views are very nice. I learned a lot. In my view, the bank is having trust on public and lending the money, not only they are believing the trust they asked for proofs, if they are sufficient with collateral security. As my friends said it is not a charity right, if the loan is paid back then only again money will get circulated.

So the people who roaming like anything to get the money they should take initiative to repay the loan at the same time. It cannot be forced but people should itself think otherwise they will lose their security simple. So if is paid properly they only they will get it again. If bank it utilized in a proper way everything will be fruitful.

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Rohit Kumar said: (Sun, May 26, 2013 07:04:10 PM)    
 
Banks does not have its own money to give loans they accept money from public as deposit and then lend that money to the borrower. And the deposit money is payable on demand of the customer. And at the sanctioning time of the loan bank should told every condition to the borrower. After the bank can be strict on the loan recovery. But physical force should not be applied to any borrower.

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T Ahuja said: (Sun, May 19, 2013 05:57:50 PM)    
 
Of course banks should not use force to recover Bank's lent money. Bank has various other legal recourse to recover Banks fund. First Before sanction of the loan Bank should have assessed the repayment capacity of the borrower. Have done Due Diligence? Find out the reasons why the borrower is unable to pay. Whether he will be in a position to repay the loan or not. If not give the chance for settlement rather than using force for recovery of Bank Loan. People have trust in Banks and deposit their hard earned money. On the other side they take help from the Bank by getting loan for their needs. There are a very few borrowers who have capacity to pay but unwilling to pay a stringent action be initiated against them but within legal framework by not using the force.

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Arun Khanna said: (Sun, May 5, 2013 05:22:16 PM)    
 
First of all the financing should be prudent. There is no scope for the banks to use force, but for willful defaulters the Legal remedies should be enforced strictly and timely to recover the public money.

There are people enjoying the bank loans without repaying, despite having means to repay, there the tools available to the banks should be used "efficiently" and professionally.

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Poonam said: (Thu, May 2, 2013 07:19:16 AM)    
 
Hi Friends, According to me in India three types of people exist. First who are poor, 2nd who are middle class and 3rd who are rich. Loan are those people who are needy. Banker always try their force on poor and middle class people who sometimes unable to pay loan due to some strong reasons. But bankers not say anything to rich people. Bank should try to understand the problem of needy people. Instead of using force Bank try to give them some more time to pay back loan.

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Suleman said: (Sun, Feb 3, 2013 08:52:57 PM)    
 
HELLO,

Myself completely disagree with the statement. Use of force to recover loan is false statement. Because banker can apply force to main on farmers and small business owners.

1. For above category are always willing to pay the all loan amount regularly if no unforeseen things happen.

2. But for the case of big business man and millionairess never pay loans. So many examples are there.

I conclude that only bank can take documentation perfect that payout period completed then recover by law should be clear.

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Dipak Patel said: (Mon, Jan 7, 2013 05:05:35 PM)    
 
Hello,

Banks are acting as a trustees and not as a owner of the funds. The loans are given from the deposits made by the public in general. Moreover, in present scenario the banks are also answerable to its shareholders. The bank finance is not a charity. It is given to the needy person only after the request of a person.

However, before sanctioning the loan to any person/institute, the bank should thoroughly examine about the project and its viability. If it fails to do so, there are more chances of getting it bad. There are number of elements, which effect the recovery of the loan. If a person/institute is financially sound and yet not repaying the loan they are willful defaulters and bank should take strict actions against them. For the reasons above control, if the project fails, bank should take lenient actions and try to rehabilitate them.

Hence, only after considering the reasons for failure of loan, bank should take proper action to recover the money.

Thank you.

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Niranjan said: (Wed, Dec 19, 2012 06:03:03 AM)    
 
Use of physical force as a means of recovering loans by banks should be strictly dealt with as it is unconstitutional and literally a case of white collared hooliganism.

Instead a bank should do a thorough background check of the borrower so that the risk of default is minimized.

Also the government should encourage PSU banks to offer loans on cheaper interest rates and flexible EMIs so that it is easier for an individual to repay any loans.

Stringent laws should be enacted against people who default deliberately so that banks can have a upper hand when dealing with such people.

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Awadhesh said: (Wed, Nov 28, 2012 11:35:38 AM)    
 
As per my opinion bank should try to know that why customer are not able to pay and what are the reason. If customer have some financial problem than they should make EMI accordingly to recover lone amount because they have given lone on interest and its is very high.

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Deepak Parsad said: (Fri, Oct 19, 2012 01:26:10 PM)    
 
In My Opinion. This is a Wrong way to use Force by Bank to recover Loans.

Because There Are Different types of Peoples in India According their Profession.

Some Peoples Are Good Business Man, Some Are Employee, Some are Farmer & Other Are Poor & unemployment.

First of All. If a Person Do not Repaying their Loans Payment, a Bank Should Know About Why He/She is not Repaying their Loan Payment. If His Condition is Critically So A Bank Should Create A Settlement letter to recover their Loans. If After the Settlement Letter, Person do not repay their Bank Loan Payment. Then A Bank Should Send a NOTICE to a Person Who take the Loan as Legally.

If After that He/She is not able to Pay Their Loans Payment. Then A Bank Should Create A Legal Notice That If A Person Have Son/Daughter, if He/She is above Age Or Under Age of 18, Then He/She Would Fulfill His Father/Mother Loans Payments Time To Time. If His Son/Daughter Will Not Repay Their Payment then Company Will Take A Strict Action Against Him/Her.

& A Bank Will be Liable To Seize His/Her Whole & any type of Property Legally.

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Poonam said: (Fri, Aug 31, 2012 02:44:07 PM)    
 
Hi Friends, According to me three types of people are exist in India. One who are able pay their loan and they are even paying on time 2nd thosse who want to pay loan but they are not able to do because of some financial problem And Last one are those who never want to repay their loan. So I Think Bank should be careful when they are giving Loan to people. And bank should give much more time to 2nd type of people to pay their loan before taking any strong action But immediate take strong action against 3rd type of people.

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Mohammed Rahim Ullah said: (Wed, Aug 22, 2012 07:58:23 AM)    
 
Right now in Bangladesh there are a lot of banks and financial institution are playing in the same fields. Every banks or financial institutions has set high target in terms of disbursement or profit maximization. The high target set is the main problem from the banks or FIs side. To maintain this, the officials of the these institutions make unhealthy competition in the market. For example- "X" Bank disbursed a certain amount of loan to a particular good customer with high creditworthiness. But the "Y" bank approach to the same customer I will be you loan just double of the "X" bank and You need not to liquidate the loan of bank "X" loan.

In that case, the borrower cannot properly use the fund or somehow get the scope to divert the fund because his/her business doesn't require excess fund. In that case he/she can not maintain or repay both the bank loan installments properly because the business is not generating the expected cash flow.

So I will emphasized on the relationship banking (Customer-bank) activities besides high credit worthiness of the customer. Relationship banking can prevent default of the loan.

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Neelam said: (Sat, Aug 18, 2012 08:28:31 AM)    
 
First of all we should bifurcate the people into two. 1) will full defaulters and another genuine. Now a days willfull defaulters have turned out a lot. Hence in order to arrest the same a slight negatativity has to spread to create awareness as well to inculcate the habit of repaying the installments on time. 2) genuine - banks have do certain provisions to cut down the rate of interest or to delay the period of repaying the loan. Finally banks are for the devolopment of the country which has great impact on the economy of the country.

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Seema said: (Thu, Aug 9, 2012 06:38:10 PM)    
 
Some banks behave like local financiers to recover their loan amount from the borrower. They harass over the phone, they send their staff home and threaten to humiliate the borrower even after knowing that he or she has a genuine problem. Hence you read about suicides by people who are unable to deal with this kind of harassment. Does the reserve bank of India not have any laws to help the borrowers in times of crisis.

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Smita said: (Thu, Jul 26, 2012 11:18:55 AM)    
 
Hi friends.

Banks provide loans to help people in their bad financial conditions but if people will not pay back than banks need to hold a bid to get back their money. This is only option but using force is not good option because India is a developing country and anything like using force make a bad impression on people and threat others to stay away from taking loans.

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Tyson Dale said: (Wed, Jul 18, 2012 01:28:08 AM)    
 
As a for profit organisation, banks should be responsible for the defaulted loans they issue, as an investor is responsible for a bad investment. If one purchases stock and loses money, one has no right to assault, through either legal or physical means, the institution from which they purchased the stock in order to gain financial restitution. When a loan is issued, the bank accepts a degree of risk. If their customer defaults on a loan and cannot supply the required funds, for whatever reason, the bank has accepted the risk and must therefore also accept the financial loss. The defaulter will have to suffer legal ramifications for dishonoring the arrangement (i.e. Bad credit). There is absolutely no justification for the physical or verbal harassment of a person because they are UNABLE to pay their debts.

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Srinivas said: (Tue, Jul 3, 2012 03:27:38 PM)    
 
According to RBI (RESERVE BANK OF INDIA) guide lines use of force to recover loan is not legal. All the banks will survive on people trust, so if the trust is ruins then how banks can do their business and that will create black mark on banks and people trust, after all banks depends on trust, Before the disbursement of loan to any person doing KYC (Know Your Customers) is mandatory by RBI.

Secondly proper verification should be there, the person who has applied for the loan, banks officials should check eligibility criteria and potential and meet the person directly for certain clarification. Banks also do need to send a intimation to the concern person before the premium.

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Rajendra said: (Sun, Jul 1, 2012 01:25:38 AM)    
 
The bank on about customer give loan the return of the bank doing loan recovered.

And if the banks fail to check their customer's credibility thoroughly at the time of sanction of loan then its the bank's fault it should not harass the customer for its own fault. But people should know that banks not meant for charity rather they are a well established financial institutions and work for profit motive.

Rate this:   +1   -1


Shubham Dhangar said: (Mon, Jun 18, 2012 04:29:54 PM)    
 
Hi I am SHUBHAM,

Well people search such a bank that can give them loan and then leave them alone; unfortunately they are unable to find it. Using force by banks to recover loans is not a healthy deed. But people should know that banks not meant for charity rather they are a well established financial institutions and work for profit motive.

RBI has declared the use of force for loan recovery as illegal. But, RBI should make its rules of loan recovering flexible so that both the interest of the bank and its customers is judged and protected.

Rate this:   +11   -2


Donald said: (Thu, May 31, 2012 11:18:04 AM)    
 
Acording to RBI (RESERVE BANK OF INDIA) guide lines use of force to recover loan is not legal. All the banks will survive on people trust, so if the trust is ruins then how banks can do thier business and that will create black mark on banks and people trust, after all banks depends on trust, Before the disbursement of loan to any person doing KYC (Know Your Customers) is mandatory by RBI.

Secondly proper verification should be there, the person who has applied for the loan, banks officials should check eligibility criteria and potential and meet the person direcrly for certain clarification. Banks also do need to send a intimation to the concern person before the premium.

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Ts Ranganathan said: (Sat, May 12, 2012 09:16:47 PM)    
 
Use of force by banks to recover money is not only illegal but also unethical, and no body can take law into their hands.

Bank lends money collected from depositors to loanees and any default in repayment affects the money available for further lending. Hence bank need to recover the money lend and the borrowers have an obligation to repay. But sometimes there are instances beyond the control of borrowers due to which they are unable to repay and in such cases banks have to give time or reschedule the loan or can resort to lawful means.

Again banks resort to such force only in respect of small farmers but in respect of big borrowers the same banks give compromise and negotiated settlements etc. Banks should adopt a uniform approach with regard to recovery.

Banks can avoid this kind of a situation if banks at the time of granting the advance exercise more cautious approach. Many a times sanction after protracted visits by prospective customers is one of the reason for the borrower not paying in time.

Banks have got a a duty to educate its customers on the benefits of availing loans only to that extent which they can comfortably repay.

Banks have to comply with the banking codes.

If banks use force repeatedly,0ver a period of time the good borrowers may not be willing to avail loans which will ultimately affect the business of banking itself.

Rate this:   +5   -1


Bikram Joshi said: (Mon, Apr 23, 2012 05:39:53 PM)    
 
Banks these days provide loans to its customer just without any tight information of the borrower. Thus, it creates a situation of inconvenience for them to recover it. In such situation the institute is left with with no other option other than to use some malice means. As such the money the borrower borrowed is the money of other individual in rotation basics. Therefore it has to be endowed with such power to recover it by any means.

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Abiodun Adeyemi said: (Fri, Apr 13, 2012 08:31:42 PM)    
 
The role of a bank in lending is likened to that of a BRIDGE across a river; the bank takes money from the surplus unit and give to the deficit side, this role is based on trust as the fund belongs to the public. Therefore, failure on the part of a borrower to repay a loan is a breach of public trust.
It is noteworthy to mention that the release of funds to any borrower at any point in time is a privilege as there are many others who also require the same fund and as such this should not be abused by borrowers. For purposes of sustainable trust and integrity and for economic growth, banks must ensure that every fund given out as loan must be recovered, if need be, some level of force may be applied, depending on a given situation.

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Shefali said: (Fri, Apr 6, 2012 03:55:08 PM)    
 
No I don, t think that banks should take such a cheap measure to extract their money out. Banks first of all should carefully go through the purpose for which the customer is taking loan and if feels satisfied than only loan should be granted and moreover after granting loan if bank feels that instalments are not properly or timely coming than bank should start taking actions like timely notice or reminder to the customer, timely visit at the customer, s and gradually warning him for legal action rather than directly sending the force because it ultimately affects the reputation of the bank and hence nation's.

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Karishma said: (Sun, Mar 18, 2012 02:52:52 PM)    
 
Yes, I agree with this statement, because if banks has a right to give loans then they have a right to recover in the best possible manner in which they can. If the person is not able to repay the loan, then he has no right to take a loan. Banks are here to lend money to help people for a particular problem, why people not understand that they are not doing a charity.

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Firoj said: (Fri, Mar 16, 2012 09:37:31 PM)    
 
Hi Friends, according to my view bank have no right to send goons to the customer's door. Bank first check the credit of the person who is coming for loan. Only on the bases of person annual income and its others property, bank should give the loan. On the same time bank should tell all its condition regarding the loan to the costumer. Before last date bank should call the costumer and recall him about his/her loan and said to him to pay loan at the time. If any one is fail than banks should first give a legal notice to the costumer after that bank should make a case against him in court. FORCE is not the solution of such these condition.

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Sana said: (Mon, Feb 6, 2012 09:23:46 PM)    
 
Though there are many options, using force is more viable that too for cheaters who has gone abscond. Proper customer evaluation mechanism should be in use to prevent this case at the beginning stage. Risk profiles should be created and should be cautious with customers placed under high risk category. Wat if the person with high credibility becomes bankrupt? there's no other way than to own the security pledged by the defaulter. But if it's an unsecured loan which is given on the will of the manager judging the customer's credit worthiness? The only way is to recall by force but it may have negative impacts which may make the customer to take hasty decision like ending his life. So it's up to the management to make the advance after looking at various security concerns.

Rate this:   +4   -1


Sanket said: (Mon, Jan 16, 2012 07:42:27 PM)    
 
Banking is also a business and no one wants to loose their money so definitely bank also never want that.Before granting loan to customer they should study its background .rather than doing it banks are advertising that they can give loans in just 5 minutes,this is where the problem starts customer feels it good and takes it without thinking how to return it.Force is not best way for recovery .They can recover it by legal ways like auction of property etc.

Rate this:   +41   -2


R Thapa said: (Fri, Jan 13, 2012 08:55:18 PM)    
 
I think bank should not use recovery agent, which can be avoided by carefully examine the history or the capacity of the repayment og the customer. If he seems to be unable to re pay bank should not grant any loan if granted also bank must try to recover by way of legal means and if not possible by any legal action then as a very last option he can try to recover his loan by force, but this can be avoided if bank creats a seperate cell which will examin the payment capacity of the customer before grantion the loan.

Rate this:   +4   -2


Deepak Tanwar said: (Wed, Jan 11, 2012 01:51:04 AM)    
 
The solution is very simple ...banks must do their homework nicely before giving loans. Forcing customers to repay the loans show that bank failed to judge the customer at the time of granting the loan. and if the customer is not repaying even if he is capable then the bank should take legal action or may get the money back forcefully.

Rate this:   +8   -1


Anand.G said: (Mon, Jan 9, 2012 03:40:05 PM)    
 
It is in the financial institutions' hands, whether to give loan or not to a particular persons. If it undergoes a wide analysis of the persons ability to repay the loan within a particular time then the banks can give loan with confidence. My point is to the banker's side that they should perform a feasibility study before offering loan to a particular person.

Rate this:   +3   -1


Devendra Sinhg said: (Tue, Nov 1, 2011 10:05:01 AM)    
 
As far as my views on force to be used to recover the loan from the borrower is not justified as at the time so payment of loan bank should follows the rules in vogue and fulfills the term and conditions of loan and it should also be ensured that the person who taking loans is capable to return the same within the stipulated period. At the last since the loan is the govt money property of the person who is unable to return the loan be auctioned and amount recovered be liquidated the loan.

Rate this:   +1   -1


Devendra Singh said: (Sun, Oct 30, 2011 05:54:11 PM)    
 
I think there is no matter of using force because one who is taking loan is committed to return the same but due to some unavoidable circumstances some time he may not be able to return the same within the stipulated time, but as and when he is capable to return he returns, in case he cannot return then the guaranteeing person can be asked to deposit the same.

Rate this:   +7   -10


Ajad said: (Thu, Sep 29, 2011 11:08:30 AM)    
 
Banks these days are selling loans like vegetables to feed the profit hungry shareholders and then using all kind of tactics like sending goons to recover the money. This is not acceptable to any society. India is a country where nearly 40% are living in extreme poverty and other 25% are just above this poverty line...They will accept any kind of loan without even considering its terms and conditions. My point is the banks must ensure the repayment capacity without exception before approving loans. This is also critical to the reputation of not just Banks but the whole financial system

Rate this:   +17   -2


Raj said: (Thu, Sep 29, 2011 11:07:18 AM)    
 
I think it is a way to recovery the loan money, but there are other way. The bank first try to motivate the person to get a best way to earn money and also if possible the bank should help the customer again but in another way. It may difficult to implement.

Rate this:   +2   -3


Nithin said: (Wed, Sep 28, 2011 11:26:19 PM)    
 
According to my opinion, a bank should recover the loan amount early as possible. Because that is public's money. The term banking means accepting the deposits from the public for the purpose of lending them in a profitable manner. So the bank act as a mediator for the public. They should have the authority to recover or collect the loan amount. But it would not be in a forcible manner. There is no need to use the force. Because the customer or the public that he have already given their asset as collateral security. They can use these for sale. The bank should have the responsibility to check the credible worthiness of the customer or check whether the customer is able to repay or not.

Rate this:   +5   -4


Bagaram said: (Tue, Sep 27, 2011 12:44:10 AM)    
 
I accept the fact that there is some amount of fault with the bank but people ? are they very correct in what they are doing ? If you know that you will not be able to pay the amount why do you have to get the loan. In cases where something backfires unexpectedly I can understand but there are people who deliberately get loans and avoid paying them back and the bank has to take some step as money is in stake. So the fault lies with both I'll say. The bank should act responsibly while giving loans and so should citizens applyinng for loans.

Rate this:   +1   -2


Deeksha said: (Wed, Aug 31, 2011 10:26:51 PM)    
 
According to my view point bank first see the worthiness of customer whether he would able to pay the loan in future or not and bank must see his/her income criteria then the bank should provide loan to the customer so that they will not have to suffer in future and they will easily get their money back and in generally if the person is not able to pay the amount then bank would recover their amount by hook or by crook. So, bank must see the capability of a person that is he able to pay the amount of loan or not?

Rate this:   +33   -3


Bharat Jha said: (Tue, Aug 30, 2011 10:31:33 AM)    
 
If there is some problem in recovery of loan such that a person doesn't want to return the loan amount then bank has no other option than recover the loan forcefully from that person. But it must be according to rule and regulation. Means it should be done legally with help of layers and police etc.

It may help to recover the loan amount and at same time the faith of other customers will remains with the bank.

Rate this:   +6   -3


Aman Vishwas said: (Fri, Aug 19, 2011 10:24:21 PM)    
 
Bank has right to recover money in better manner. If they using forcible techniques it will deteriorate image of bank and people will loss confident on bank.

Rate this:   +14   -4


Ipsita said: (Thu, Aug 11, 2011 01:44:02 AM)    
 
Checking for credit worthiness is not enough at all times. What if I earn enough now but fall into difficult financial times during the time I am paying off a loan/due? Medical bills run into lakhs, so can a loss in business or even a job cut. I am NOT talking of INTENTIONAL defaults here. What can "good credit worthy" customers do when they fall into bad times? Credit cards etc only spiral the total dues. If a cstomer cannot pay, there are late fees, finance charges, overlimit charges, service charge etc. That is not all. There is even a service charge for adding late fee to the a/c. What can a person do in such a situation? There are no facilities where a customer can request for a period of relief from paying back loans/credit dues. I have not come across a single bank in India which has such a relief period.

Rate this:   +11   -1


Jay said: (Wed, Jun 15, 2011 01:51:06 PM)    
 
Yes Banks provide loans as per their obligations and targets defined. But at the same time they should check the credit worthiness of the customer before sanctioning a loan. After the loan is dispersed, the Bank's duty is to maintain communication with the customer and follow up every repayments. Still if the customer fails to repay, then the Bank should initiate proper action as per the Banks Guidelines.

Rate this:   +6   -3


Manasi Ghosh said: (Mon, Jun 13, 2011 12:10:24 AM)    
 
I do agree that,use of force to recover loans is not desirable banking practice.The term banking means accepting deposits from public for the purpose of lending in a profitable manner.When banks asset becomes NPA banks fails to recover it by soft skill like public notices, legal notice ,it may be permitted to use trained,skilled recovery agents with the prior permission of higher banks officials . After all its public money ,bank has every right to recover its assets. But, rampet use of recovery agents should be banned,it is not desirable in any financilal system and also crital to the brand image of the Banks.Before sanctioning of any loan Banks should analyse its creditwotiness to avoid auch type of situation.

Rate this:   +4   -0


Anurag said: (Thu, May 12, 2011 01:06:28 PM)    
 
The bank has no right to send goons to the customer's door. The banks take collateral which is more or less same as the amount they are lending to the customer. The collateral may be the insurance policy or deposits of the customer etc so the bank always has option to confiscate these assets and recover their money.

And if the banks fail to check their customer's credibility thoroughly at the time of sanction of loan then its the bank's fault it should not harass the customer for its own fault.

Rate this:   +25   -1


Vineet said: (Wed, May 11, 2011 02:50:48 PM)    
 
Giving loans is an essential part of banking and recovering the dues is also very important aspect, and for the matter of fact bank do check all the documents and assess the credit worthiness of the Customer, but if still people refuse to repay with an intention to default, using a recovery agent becomes necessary. As the money that bank gives as loan is public money.

Rate this:   +1   -2


Naveen Sagwan said: (Fri, Apr 22, 2011 12:45:28 PM)    
 
Well when we all aply for a loan Bank always check Customer Credit History,so some of my friends giving suggesion for CIBIL, But banks perform their duty in a proper way.I have been worked in Bank Collection & i saw many person who takes loan just for default.i dont know what is the problem with cust, when they need Finance they walk up to bank and when bank need their return they simply SKIP. i don't know why they walk up to their RELATIVES when they require finance.why only bank. some cust says your sales executive keep on calling for taking loan so we took ,but have u ever travel in Train , Buses, there are lots of small seller they do lot of activity to convince us to purchase their product, but we only purchase if we need it ,otherwise we ignore it.

SO now the conclusion is this if banks are proiding loan to customer when they really need then what is the problem with the customer to pay back ??????

No doubt bank always help to customer in every circumstances. But customer wil be customer his mindset is to default, customer has money to pay mob bills, electric bill,school fee, vehicle fuel, then why not for BANK ?????

Rate this:   +9   -1


Anil Meena said: (Fri, Apr 22, 2011 05:18:27 AM)    
 
The all discussion which given are good, but whatever discussed, it already implemented by mfi companies, they give divide the customer according to their income, according to their activity, and according to their paying capacity, so by this customer not get burden of the loan, customer fill easy to pay, this kind of amount are sufficient to invest in their activity and earn more money by invest loan in right way, it all monitor by mfi companies that's why mfi sector are so successful in India.

Rate this:   +1   -2


Vikas said: (Wed, Apr 20, 2011 04:57:26 AM)    
 
I agree with statement first of all bank gives the temptaion of loan to the customer, when customer trapped the loan mania, then bank send their goons to collect the rest of amount, bank sell the loan like vegetable they don't check crdit worthiness of the customer, bank should reform their policy regarding loan.

Rate this:   +2   -1


Gaurav Angi said: (Thu, Mar 17, 2011 04:23:54 PM)    
 
Sandeep, I agree with your point, that bank should check the credit worthiness of an loan seeker before granting them the advances. There is a agency called Credit Information Bureau India Limited (CIBIL) which provides credit history of an individual (if he is not applying for the loan or any type of credit for the first time) bank check their credit report and also ask individual for some colletral securities so that the risk of credit default could be minimized.

Rate this:   +3   -0


Sandeep said: (Sun, Mar 13, 2011 02:55:00 PM)    
 
Arun, I appreciate your words but think of the situation when people needs money. They are not just taking it for the comfort of their life, they are taking because they are in need. Firstly the bank should take note of the property available with the customer. If the customer don't have enough property they should not be given loan. But this is also not a solution, the bank should impose different loan interest to different customer depending on the annual income. This might solve the problem.

Rate this:   +3   -0


Arun said: (Fri, Mar 11, 2011 09:54:37 AM)    
 
I accept the fact that there is some amount of fault with the bank but people ??? are they very correct in what they are doing ?? If you know that you will not be able to pay the amount why do you have to get the loan . In cases where something backfires unexpectedly I can understand but there are people who deliberately get loans and avoid paying them back and the bank has to take some step as money is in stake . So the fault lies with both I'll say . The bank should act responsibly while giving loans and so should citizens applyinng for loans.

Rate this:   +13   -1


Gaurav said: (Sat, Mar 5, 2011 01:22:12 PM)    
 
This a very unethical practice which is being practiced by Banks nowadays to recover the loans which they have given to less credit worthy people of the society...banks should not follow this practice as it will lead to crime and it also brings inefficiencies in our financial system...so,banks should follow fair credit practices and follow the norms and guidelines give by the Apex bank regarding in giving advances and loans.

Rate this:   +2   -1


Ajit said: (Sun, Feb 13, 2011 12:33:35 PM)    
 
Banks these days are selling loans like vegetables to feed the profit hungry shareholders and then using all kind of tactics like sending goons to recover the money. This is not acceptable to any society. India is a country where nearly 40% are living in extreme poverty and other 25% are just above this poverty line...They will accept any kind of loan without even considering its terms and conditions. My point is the banks must ensure the repayment capacity without exception before approving loans. This is also critical to the reputation of not just Banks but the whole financial system.

Rate this:   +8   -1


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