The Reserve Bank of India (RBI) Governor Urjit Patel has been summoned by the parliamentary panel to answer queries related to bank scams. As per reports the RBI governor will present himself in front of the parliamentary panel on May 17. This is regarding the bank scams that have come to the fore in the past couple of months. The Standing Committee on Finance, raised several queries related to the Indian banking sector with the the Financial Services Secretary Rajiv Kumar. The Committee is headed by veteran Congress leader M Veerappa Moily.
Earlier the RBI had ruled out any relaxation in the rules associated to bad loans. The reason they had cited for this rule was that they wanted to discipline borrowers and prevent banks from brushing bad loans under the carpet. This was conveyed by the RBI governor to parliamentarians in a meeting on 10 April. This follows the directions banks were given regarding accounts showing signs of ‘weakness’ in repaying loans. As per the news rules, banks if they fail to identify defaulters and put a plan within 180 days, the loan will have to be referred to the dedicated bankruptcy court.
“The RBI is very clear that such measures are needed to clean the banking system and any dispensation could be misused,” said a senior official. “The RBI has withdrawn all schemes because they were seen as ways of delaying the recognition of NPA and was resulting in banks restructuring their own books and not that of the borrowers,” the official added.
NewsX has so far brought 30 investigations in one of India’s biggest campaign to trace and track NPAs. It traced many money defaulters who flouted bank norms and fled away with big amounts. Some companies allegedly took big amount loans on the basis of fake documents and then fled the country.
Of the many cases that exposed alleged scams of hundreds of crores, the top 5 cases on the NPA list were — NAFED Rs 382 crores, RP Info Systems Rs 73 crores, Pixion Rs 1959 crores, Adigear Int Pvt Ltd Rs 39 crores, Dwarka Das Seth Int Rs 359 crores.
And while the country has been reeling under the fraud that was committed by the likes of Nirav Modi and Mehul Choksi, Tuesday morning of 17 April saw ATMs go dry. Citizens were reminded of the days post demonetisation when there was a cash crunch and long queues were witnessed outside ATMs and banks.
On the ongoing cash shortage, the Congress president Rahul Gandhi slammed the Modi government for the prevailing crunch and blamed him for destroying the banking system in the country.