Bank after bank is collapsing. Not only in India but also elsewhere in the world. This means that banking is being taken advantage of by the politicians, industrialists and influencial people.

Banks operate by taking public money at a rate of interest and lend that money in the form of loans at a higher rate of interest. The differerence is to be the operating margin for the banks.

When banks are the custodians of public money, then it follows that that they have to be careful where they lend the money. They are supposed to ensure that loan-takers return the amount within a stipulated time.

So they have to follow certain procedures of lending and this process need to be given at the hands of responsible professionals.

1). Loans have to be provided to buyers with co-lateral safeguards. This has to be adhered to strictly, no matter what the competition is. This is because, loans, by nature are a risky proposition. For eg. Loan given for farming or setting up an industry cannot be said will succeed.

2). Loans if provided on the recommendation of politicians or influencial people, due legal guarantee have to be taken from those recommending in addition to guarantees from the loan takers. .

3). It is better if factual & authentic Credit rating is given to individuals or Institutions taking loans. Amount of loan can be based on such credit ratings.

4). The punishment for default of loan repayment must be made severe and prompt for loan takers, guarantor as well as the issue officer if he has acted bypassing the laid out procedure. Presently the perpetrators are no doubt arrested, but legal procedure takes so long that eventually the criminals come out on bail.

5). Above all good conscience must prevail in all, the loan taker, the recommending agency and the official sanctioning the loan.

Otherwise more and more banks will fail and public and nation as a whole shall be the losers. Hope some good sense prevails in all. more  

View all 34 comments Below 34 comments
I agree with Vijay Raghavan but banking is a complex business and not like ordinary business which are allowed to be liquidated more  
I agree with Govind Vijayraghvan. more  
This is all because of some corrupt politicians, from 2010-2014 loans to industrialist and others just because of influential affect they had in ruling government and now the common man and tax payers will have to bear all their sins more  
In India, behind every crime there is a politician. Unless they are identified and culled from existence, this country can never go anywhere. more  
Gautam, try to send the request to Nippon, they might be able to help out. Politicians and big influential persons are robbing the public dry. The bank officials are so stressed trying to get business that they have become lax in their dealings as a result of that, we the general public have to suffer. Jail sentences for all defaulters is a must. Maybe then this practice will stop. I was wondering how so many people have bought cars worth lakhs of rupees, bought flats worth lakhs. Where are they getting the money from???? From the banks who they never repay and the common man who puts his money in has to suffer. more  
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