July 13, 2021

Raijor Dal demands implementation of Act to rein in MFIs in Assam

The Act to rein in the MFIs was drafted and passed when the present Chief Minister Himanta Biswa Sarma was the finance minister in the previous government.

Guwahati: As the Budget session of the Assam Assembly got off on Monday, the Opposition Raijor Dal iterated its demand for implementation of the Assam Micro Finance Institutions (Regulation of Money Lending) Act, 2021, which will provide succour to lakhs of women in the state.

The party claimed that this law was vital now as people are under extreme economic distress due to the prevailing pandemic and repeated lockdowns, and the situation has been laid bare by reports of people having to allegedly sell their kidneys to repay their loans from microfinance institutions (MFIs) in the state.

“The incident in Morigaon has exposed the situation of the people. The illegal kidney trade is rampant there as people are being forced to sell their kidneys to pay for their children’s treatment, their MFI loan instalments, etc,” Russel Hussain, vice-president of Raijor Dal, said at a press conference here.

An illegal kidney trade racket was busted in Morigaon district on Sunday and two persons were arrested.

Police said, at least six persons of a village were allegedly lured with money to donate their kidneys at a hospital in Kolkata.

Hussain further said the pandemic and lockdowns have further compounded the problems of people and the BJPs pre-poll promise of waiving MFI loans for all women borrowers was a glimmer of hope for them.

“If the law is implemented, all the borrowers will be benefited, as was promised by the BJP. But they have now put riders for being a beneficiary and this would deprive a major chunk of the women,” he said.

Also Read: Almost 30,000 posts in Assam Police lying vacant: Assam CM

The bill was passed in the state Assembly on December 30 last year and the Governor signed the gazette notification on January 27, but the state government has failed to implement it so far.

The Raijor Dal leader pointed out that if implemented, it would automatically lead to waiver of all loans and there was no need for the state government to pay from its coffers to the MFIs.

The Act will also prevent harassment of women borrowers by the lenders, as it would invite imprisonment and fine if the lender indulges in it, and also ensure that agents cannot visit residences of the borrowers, demanding repayment.

The Act to rein in the MFIs was drafted and passed when the present Chief Minister Himanta Biswa Sarma was the finance minister in the previous government.

The new state government, in its very first Cabinet meeting on May 11, had constituted a committee to assess the financial implications of waiving the loans given by the MFIs.

The committee, after its initial investigations, had revealed that an amount of Rs 12,500 crore, including principal and interest, was outstanding as of March 31, 2021, involving 26 lakh customers and 40 lenders.

The amount was later worked down to Rs 8,250 crore by the government after discussions with the MFIs as many loans were given flouting RBI norms.

It was decided that the state government will be paying off the loans on behalf of the eligible beneficiaries.

Several conditions were recommended by the committee like only those loans will be considered which were taken before December 31, 2020, and those with a family income of Rs one lakh, paying income tax, owning four-wheelers or any other such guidelines set by the RBI will not be considered for a waiver of loans.

“All these conditions will stand nullified if the Act is implemented, and we sincerely hope that the state government will soon do it,” Hussain added.

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