Cases pile at Money Loan Court

The number of settlements in the Money Loan Court, the last resort for recovery of defaulted loans, is very low, even though the number of cases is piling up day by day. Due to this reason, the efforts for the recovery of the loan moneys are progressing at a snail’s pace. On the other hand, the defaulters are going scot-free through the loopholes of legal obligations.

According to the latest data of Bangladesh Bank, at the end of March of this year, the total number of cases filed with the Money Loan Court by 60 banks in the country was 2,07,593. About Tk 2,36,489 crore are stuck in these cases.

In December last year, the number of cases was 2,06,584, against which the amount of money involved was Tk 2,26,292 crore. As such, the number of cases increased by 1,009 in the first three months of this year. And the amount of money involved has increased by Tk 10,197 crore.

The pile of cases is increasing mainly due to slow down in disposal of previous cases and increase in new cases.

Sources said that the banks are not able to bring the defaulters under the law even though the criminals are supposed to be caught through the law. Taking advantage of this situation, criminals are using the law as a shield to loot people's money. Influential defaulters are taking advantage of court stay orders.

According to the available information, at least Tk 76,000 crore have been taken away by looters, leading to a liquidity crisis in banks.

Those having knowledge about the situation, said if you add the amount of stay orders to the total risky loans, more than one-third of the country's loans have to be classified as bad.

Bankers said it is in no way compatible with the economy of a democratic country that more than one-third of its loans would be classified as bad.

Banker also said to recover the loans disbursed through various financial irregularities and frauds, the banks are forced to file lawsuits in various courts including the Money Loan Court as they could not collect the loans in the normal manner. But due to less number of courts and lack of judges than required, and not being able to provide sufficient time and supporting collateral documents to bank lawyers for legal opinions, the cases in Money loan courts are delayed. A mountain of cases related to defaulted loans has accumulated in the Money Loan Court.

Former chairman of Association of Bankers Bangladesh (ABB) Nurul Amin told reporters that the money loan court can be a very effective court, but it is ineffective because there is lack of sufficient manpower and courts. “So the pile of cases is increasing day by day. Apart from this, repayment of a large amount is being delayed by influential people through stay orders or writs, which is affecting the liquidity situation of the banks.”

However, a source from the money loan court said that some banks do not follow up after filing a case. As the plaintiff and the accused are not present, the case go on for years. The hearing date keep changing. There have also been instances of not seeking the case report for 20 years.