The recent trend of publicly naming and shaming borrowers by banks in J&K has stirred significant concern among Kashmir’s business and industry communities. The Kashmir Chamber of Commerce and Industry (KCCI), the Federation of Chambers of Industries Kashmir (FCIK) and other trade and business bodies have voiced strong opposition to the banks’ “unprecedented coercive actions” against borrowers. Most of these individuals and businesses, already burdened by difficult circumstances, face immense social stigma as their names are released in the press, compounding their economic and personal struggles. Kashmir is a small and closely-knit social system where such public naming and shaming could leave negative societal implications for generations to come.
It is a matter of fact that many of these businesses became Non-Performing Assets (NPAs) due to unavoidable crises that have severely impacted the region. Factors such as the devastating 2014 floods, the social unrest in 2016, the 2019 political transition, and the global COVID-19 pandemic have all disrupted local economies. These were, admittedly, uncontrollable forces that the business community has struggled to overcome, and they should not be penalized as if their situations were purely the result of mismanagement or negligence.
Publicizing the identities of struggling borrowers also undermines any chance of a fresh start. This strategy imposes unnecessary psychological distress, harming not only the borrowers but also their families, creating an atmosphere of fear among the business community. A more humane, effective approach would involve the introduction of a Special One-Time Settlement (OTS) Scheme, as recommended by KCCI and FCIK for struggling businesses. This would give borrowers the chance to clear their dues under realistic terms without the looming threat of public humiliation or property forfeiture.
Furthermore, as FCIK points out, banks’ tactics may also breach existing national guidelines. The Government of India’s 2015 framework, as well as Reserve Bank of India (RBI) directives from 2016, mandate a revival-first approach for MSMEs experiencing distress. The Supreme Court’s recent affirmation of these guidelines highlight the need to exhaust rehabilitation measures before moving to classify accounts as NPAs. Instead of rigidly enforcing repayment through extreme measures, banks like the J&K Bank should work with borrowers, recognizing the unique challenges faced in the region, particularly by the MSME sector.
KCCI and FCIK are right to request the intervention of government officials to protect borrowers from harsh recovery methods. There is a crucial role for the Lieutenant Governor and Chief Minister to play here: directing the banks to halt the naming-and-shaming practice, while prioritizing a Special OTS Scheme aligned with MSME norms, devoid of restrictive caps, and tailored to address the challenges of local businesses. Such a scheme would not only offer financial reprieve but also restore the dignity of borrowers, who could return to productive participation in the economy.
This newspaper has been insisting that it is essential to acknowledge that sustainable economic growth in J&K hinges on supporting, not vilifying, its business community. An environment where businesses feel harassed and fearful is not conducive to economic recovery or resilience. By halting aggressive recovery measures, publicly shaming borrowers, and implementing a Special OTS Scheme, banks like J&K Bank can contribute meaningfully to the state’s economic revival. This strategy is not just fair but essential for rebuilding trust between the bank and the local business community.
The time has come for banks, including the J&K Bank, and the authorities to lead by example, showing empathy and prudence in their approach to loan recovery.
Hello, as a newbie to cryptocurrency trading, I lost a lot of money trying to navigate the market on my own, then in my search for a genuine and trusted trader/broker, i came across Trader Bernie Doran who guided and helped me retrieve my lost cryptocurrencies and I made so much profit up to the tune of $60,000. I made my first investment with $2,000 and got a ROI profit of $25,000 in less than 2 week. You can contact this expert trader Mr Bernie Doran via Gmail : [email protected] or whatsApp + 1 424 285 0682 and be ready to share your experience, tell him I referred you
Why useers stilll make use of to read news papeds whben in this ttechnological worpd alll is availaboe on net?
833822 944165Hey there, I feel your blog may possibly be having browser compatibility issues. When I appear at your web site in Safari, it looks fine but when opening in Internet Explorer, it has some overlapping. I just wanted to give you a quick heads up! Other then that, superb blog! 977218