Govt asks banks to name and shame wilful defaulters

Tightening the noose around wilful defaulters, the government has asked banks to ‘name and shame’ such borrowers by publishing their photographs and other details in newspapers.

According to PTI, the finance ministry has written a letter to all state-run banks directing them to take board approvals for publication of photographs of such defaulters.

The number of wilful defaulters, who did not repay loans to public sector banks (PSBs) despite the capacity to do so, rose to 9,063 at the end of December 2017. 

Minister of State for Finance Shiv Pratap Shukla had said in a written reply in the Lok Sabha that the amount involved for PSBs is reported to be over one lakh ten thousand crore rupees.

Several big defaulters like Nirav Modi, Mehul Choksi, Vijay Mallya and Jatin Mehta have fled the country putting the recovery mechanism in quandary.

The government had last week directed banks to seek passport details of borrowers taking loans of 50 crore rupees and more. It also tabled the Fugitive Economic Offenders Bill in the Lok Sabha, aiming to impound and sell assets of such fugitive defaulters.

The Finance Ministry has also directed public sector banks to probe all NPA accounts of over 50 crore Rs for possible fraud and accordingly report the cases to CBI. 

Besides, the ministry had asked banks to monitor loans above Rs 250 crore and red flags whenever the original covenants of the loans are violated. This was spelt out as part of 6-point-reform measures announced.