Don't let financial chaos spread

Microfinance borrowers protested in the federal capital. Their agitation has been suspended after the government agreed on Friday to meet some of their demands. While the debtors are collectively raising the voice of Minaha, there is also a debate going on about what is fair and unfair such a demand. Concerns have also been expressed that the system of taking loans but not making regular payments and increasing pressure by protesting and petitioning the government will increase financial chaos.

Due to the effect of the weak economy, the profit of banks and financial institutions is continuously decreasing, while the ratio of non-performing loans is increasing. On the one hand, due to problems in the business, the borrowers are not able to pay the loan amount on time, on the other hand, there is an increase in the number of people who do not pay even if they have the capacity, in the hope that the loan will be waived off. The main problem caused by such activities is the loss of trust in financial institutions. The most important asset of a bank is the trust of its citizens. Even institutions with strong financial indicators can sink tomorrow if the confidence of the citizens decreases and the line of withdrawal of deposits is reached. A few weeks ago, a group took the name of a commercial bank and withdrew 47 billion rupees from that institution only because the deposits were not safe.

Bank collects deposits from customers and provides loans to those in need. The bank is only an intermediary. Depositors trust the bank more than themselves. Therefore, the protection of citizens' deposits is the prime responsibility of the bank. Being a financial intermediary, it is also the bank's responsibility to collect the capital that is scattered in the society, create national capital and provide loans to the necessary areas. At the time of borrowing and lending, both parties have agreed on the interest rate, in how many installments, and how long the loan will be repaid. It is the customer's duty to repay the loan as per the contract.

Therefore, after taking a loan from banks and financial institutions, there is no question of Minaha. Waiver of one's loan means that the depositor's savings are either forfeited or unprotected. Such a trend creates problems in the financial system itself. Such a risk is unimaginable in the financial system. Banks and financial institutions asking for payment without understanding the borrower's condition, auctioning mortgages against the law, and evicting the borrower have not been seen. It is not right for the customer to intentionally default on the loan and for the bank to grab the customer's property intentionally. If it happened, such activities should be stopped from both sides. The role of the regulatory body is also more important.

In the past, the government has repeatedly introduced programs to waive the loans of small farmers, so now the borrowers may have demanded loan waivers from private banks and financial institutions with similar expectations. In recent days, Finance Minister, Rashtra Bank Governor, etc. have been taking a stand that loans taken from banks will not be waived, they have been saying that those who spread apathy towards the banking system will be dealt with according to the law. But when such activities are increasing on the roads, no action is taken to stop them from the state level.

The government is silent even when the group demanding loan waiver is assaulting the bank employees. This is encouraging those who do chaotic activities and the morale of the bank employees has gone down. Therefore, the government should immediately control such chaotic activities. It is necessary to spread awareness about why loans cannot be waived in banks and financial institutions while making financial literacy widespread among common citizens. The current risk of financial chaos has highlighted the need to make the entire banking system sophisticated and agile. The attention of the relevant bodies should go to that too.