SRINAGAR: The Federation of Chambers of Industries (FCIK) has appealed to the government of Jammu and Kashmir to intervene urgently in resolving the issue of Non-Performing Assets (NPAs) and stressful accounts. The organisation seeks to put an end to the growing confrontation between J&K Bank and the business community.
In a statement, FCIK has regretted the recovery process unleashed by J&K Bank despite clear instructions from the Union Ministry of Finance to deal with the issue with utter sensitivity and a humane approach. “The harassment, intimidation, and forced eviction of individuals from their residential houses under the pretext of standard operational procedures (SOPs) are not acceptable to the business community and the society of Jammu and Kashmir, which has played a significant role in the growth of J&K Bank to its current position,” the statement read.
While expressing anguish over the recent bank action against a borrower, whose account was reportedly downgraded just five months ago, FCIK said that such an action has severe consequences on the relations and mutual trust of entrepreneurs with the bank.
“The brewing anger expressed by the masses on social media over the forcible eviction of a 95-year-old lady from her residential house should be seen as a clear message to the bank authorities,” FCIK emphasised.
FCIK questioned the bank’s leniency in recovering loans from outside businessmen who owe a staggering 6044.03 Crores as NPAs, as officially declared on 30th June 2023.
“While the amount in NPA with outside enterprises accounted for 58 percent of total deposits made by people from outside J&K, the total NPA balance of 3412.10 Crores against the borrowers of J&K accounted for just 3% deposited by the people of J&K with the bank,” the statement added.
The FCIK emphasised the need for banks to understand and ascertain the reasons for enterprises’ failure to make timely payments before taking any harsh action against them. They added that there were overwhelming cases where due payments to enterprises were held up by buyers, including government departments.
FCIK further observed that the perpetual losses incurred by the enterprises of Jammu and Kashmir over the past three decades cannot be ignored while treating the borrowers. They also criticised J&K Bank for overburdening the entrepreneurs by adopting methods of servicing accounts through the creation of overdrafts.
