Letter to BS: Lethargic banks also reason for failure of 'lead bank' scheme

This refers to “Revamping of lead bank scheme” (June 4). It is a fact that the purpose of the scheme could not be achieved due to several factors, including the lethargic attitude of the banks. Although government agencies have a major role in the formulation of schemes, identification of borrowers and assisting in recovery are front-end and back-end actions. Banks as a habit, were treating the scheme as one of low priority, mainly due to the lack of machinery for follow-up and the high level of non-performing assets from such lending. 

There was an instance during the ‘90s, where a Tamil Nadu leading bank did not have even an office, or any officer designated as lead bank officer in one of its districts for more than two years. In the same state, branch managers of a nationalised bank in one of the branches in Rameswaram district was changed every year as it was a hardship centre. It is in the same state that millions of rupees were drained as loan and subsidy to “rehabilitate scavengers” for years together although scavenging by human beings was stopped decades back and the displaced persons were provided employment by the state government. 

G Mohanadas
via email