Home ›› 19 Dec 2022 ›› Editorial
Very rarely good news or the news that inspires people to lead a life worth living appears on the pages of newspapers. Once the price of anything – be it daily essentials or be it other kinds of non-essential products- goes up usually it never comes down in our country except a very few occasions.
But a couple of days back, the news on plummeting prices of essentials in various newspapers have soothed our heart a bit amid all negative and terrible news – corruption, soaring inflation, dollar crisis, deaths from accidents, defaulted loans and so on so forth. Some of them have made headlines for quite a long time while some others are new phenomena arisen out of world economic crisis.
Of them, we are pissed off listening to defaulted loan eroding away our economy and obstructing our overall progress. There has long been debate over the issue of whether loan defaulters should be given any exit route to repay the loan or they should be punished. Whatever the argument is the loan defaulters have long been here taking advantage and using loopholes and weakness of the laws.
The government times and again have also taken measures to prevent the malpractice but it has now become a kind of hide-and-seek game. Interestingly small loan defaulters are almost always regular in paying back their loans while the big sharks are always wriggle out of the net of government and banking rules. Not only that, they also apply for fresh loans without paying off the old ones. Very often they are also granted those fresh loans in the name of obscure firms and companies by escaping the watchful eyes of the government agencies and watchdogs.
However, the Parliamentary Committee on Estimates formed a sub-committee on January 3 last year to investigate financial irregularities at Sonali Bank Limited, Social Islami Bank Limited, the National Bank of Pakistan, National Finance Limited and Premium Finance and Leasing Limited. The committee investigated defaulted loan situation in those banks and non-banking financial institutions from December 2020 to April 2022.
On the basis of its report published recently the committee said the recovery rate of small loan defaulter is much better than the large companies or institutions. The loan amounting to below Tk 10 crore is considered small loan and those over Tk 10 crore regarded as large defaulted loans. The time period when the investigation was carried out the large defaulted loan soared and their recovery rate was scanty while it is much better in case of small ones.
Even the collateral against the large defaulted was only 63 per cent while it is 150 per cent in case of small ones. This is the finding of the sub-committee that is already preparing its recommendations after assessing the defaulted loan situation. We firmly believe that after the submission of the recommendation the agencies and parliamentary committee concerned will take stern actions against those loan defaulters.
The government should form a policy for those small loan defaulters who are not willful defaulters and punish those who are willful defaulters. Ahsan H Mansur, Executive Director of the Policy Research Institute of Bangladesh told the media: “There should be an exit policy as every businessperson or business will not be successful. At the same the defaulted loan should not be spared.”
If the government can execute the recommendations of the sub-committee, we hope, the amount of defaulted loan will begin to come down helping a sturdy economic growth.
Another good sign that we have mentioned at the beginning of this editorial is declining prices of essentials. The market has already seen drop in prices of eggs, vegetables, chicken, palm oil and soybean oil. Both the news items in the newspapers including The Business Post have given people a breathing space at least for the time being.
