» Debt Swapping Under Study To Relieve MFI Borrowers: Vatti Vasanth Kumar
Debt Swapping Under Study: Vatti
The debt swapping method and the Pavala Vaddi scheme - meant to to mitigate the sufferings of borrowers of MFIs - is under study by the State-Level Bankers' Committe
Rural Development Minister Vatti Vasanth Kumar, on Thursday, revealed that the debt swapping method and the Pavala Vaddi scheme - meant to to mitigate the sufferings of borrowers of MFIs - is under study by the State-Level Bankers' Committee.
Talking to media persons at the Secretariat, Vasanth Kumar stated that the government has been waiting for a reply from the bankers on the issue.
Vasantha Kumar also made it clear that the State government has no jurisdiction over the interest rate levied by the MFIs on their borrowers.
The minister stated that borrowers in the villages were misusing the loans by using these for their personal expenses.
Vasantha Kumar pointed out that though the credit facilities should be directed towards investment to better economic status, beneficiaries were spending the loans for personal gratification. He revealed that when he spoke to a beneficiary recently, she said that she had spent the loan for travelling to Tirumala.
The minister pointed out that the government was the first to react when the DWCRA groups and SHG members were being harassed by MFIs in the rural areas.
He accused Opposition Leader and former chief minister N Chandrababu Naidu of shedding crocodile tears. Vasantha Kumar added that the Telugu Desam Party president was instigating the borrowers not to repay the loans.
The minister further accused Naidu of trying to create anarchy. Reading from the book 'Manasulo Maata' penned by Naidu, the minister said that the TDP chief waa speaking against micro-credit out of mere frustration.
Vasantha Kumar added that he was ready for a discussion on microfinance with the former chief minister publicly in the presence of borrowers.
Reacting to a question, the minister clarified that the government had fulfilled whatever the Congress had promised before the 2004 elections, including free power, while the TDP had not.
He was immediately corrected by a scribe that the TDP had not returned to power to fulfil the promises made in the party manifesto.