Hindu Business Line: Mumbai: Thursday,
April 21, 2016.
The Reserve
Bank of India (RBI) seems to be confused about how to respond to queries
related to the disclosure of wilful defaulters.
While the
regulator had earlier dismissed a query filed by BusinessLine under the Right
to Information Act, 2005 saying it did not have the resources to compile the
list of defaulters, a second reply from another desk in the RBI has passed the
buck on to credit information companies such as Credit Information Bureau
(India) Ltd (CIBIL).
“Banks and
financial institutions have been advised to submit the data regarding wilful
defaulters and defaulters to Credit Information Companies and not to the RBI
from December 2014 onwards. Therefore, we do not have the information,” the RBI
said, in response to an RTI filed by BusinessLine.
In an earlier
reply, dated April 7, the regulator had said: “Compilation of the same (list of
wilful defaulters) would disproportionately divert resources.”
This comes
even as pressure builds on the central bank to put in place a system that would
name and shame wilful defaulters. The Supreme Court had recently said that it
was in favour of making public the list of defaulters. The apex court has
observed that “the RBI is supposed to uphold public interest and not the interest
of individual banks”, nor is the central bank in “any fiduciary relationship
with any bank”.
However, the
central bank has so far refused to make the names public on the ground that it
would affect companies’ health if they are in genuine difficulty and “may
accentuate the failure of the business rather than nursing it back to health”.
Various bank
associations and unions are demanding a more pro-active response by the RBI.
“If publication of the names of defaulters would defame them or result in loss
of business, why is no such consideration being shown for the common man who
avails a bank loan? …when it comes to industrialists, all soft options are
being advocated,” said a statement from the All India Bank Employees’
Association.
More than
5,600 defaulters
According to
one estimate, there are more than 5,600 wilful defaulters, who together owe
more than 60,000 crore to banks.
Indian
National Bank Employees’ Federation General Secretary Subhash Sawant said the
RBI’s argument that it cannot allot resources to draw up a list of defaulters
does not hold much water because banks have been computerising their operations
for the past 15 years. All the information is available at the click of a
button.
.JPG)
.JPG)
