Weavers in a fix over loan waiver

 November 15, 2011 - By DC Correspondent - Anantapur 

A stalemate continues over the recovery of Rs 17 crore loans from handloom weavers in the district as the government proposed to waive these.

A stalemate continues over the recovery of Rs 17 crore loans from handloom weavers in the district as the government proposed to waive these.

State government proposed to waive Rs 16.9 crore loans availed by 9,104 crore handloom weavers in the district and the file has been sent to the ministry of finance.

While the weavers are refusing to pay the loans, bankers are insisting that they do so. Weavers who are already reeling under a financial crunch, are not in a position to repay the instalments.

A widow, Poojari Govindamma of Hindupur whose husband Krishnam-urthy committed suicide unable to pay debts one-and-a-half year ago, lamented that her husband borrowed Rs 1.3 lakh loan from a bank and repaid Rs 83,000 before he died, but she received notices from the bank about confiscation of property as per the Sarfaesi Act (The Securitisation and Reconstruction of Financi-al Assets and Enforcement of Security Interest Act, 2002). The Sarfaesi Act allows banks and financial institutions to auction properties (residential and commercial) when borrowers fail to repay their loans. It enab-les banks to reduce their non-performing assets (NPAs) by adopting measures for recovery or reconstruction.

Thousands of weavers have received notices from banks, demanding repayment of loans, though government agreed to waive these.

Bankers said that recovery percentage was poor and notices would be served to the defaulters until the government issued loan waiver orders.

Meanwhile, the order to waive 3,400 handloom weavers’ loans to the tune of Rs 8.9 crore is not being implemented on expected lines as bankers are delaying no due certificates to the beneficiaries.

As a result, cash is not credited into the bank accounts of beneficiaries. In fact, state government promised to waive weavers’ loans of Rs 348 crore of which Rs 109 crore were released across the state. It assured Rs 239 crore loan waiver in the next phase. Weavers are in a dilemma with bankers refusing to credit the cash in their bank accounts.