Many decades ago, Rabindranath Tagore wrote a short story titled Kabuliwallah, based on the life of the Afghan money lenders who used to do brisk business in undivided India. The story became so well known that it was later made into a movie starring Balraj Sahni. Largely illiterate, through a complicated maze of signs and symbols, the moneylenders kept meticulous track of who owed them how much, when was pay day and then were there at the right time and place to collect their dues. Their interest rates were of course usurious but they provided unsecured loans which their customers not having much collateral to give found beneficial. However defaults on payments were not tolerated and when patience ran out, the Kabuliwallah's justice was rough and ready. It was during such instance that the Kabuliwallah in Tagore's story stabbed a client, went to prison and the beginning of the story's climax begins there.
October 03, 2007
All this was before the advent of the modern banking system. Or at least let us say before the time when banking became accessible to the common man. The local money lender was the one who was the most accessible person to deliver a loan with minimal or no paperwork. Then came the nationalization of banks beginning in 1969 to ostensibly make banking and banking products including loans available to the masses. That did not fully work either as every where one went, there were stories to be heard that to get a loan sanctioned , a certain percentage had to be paid as a bribe to the manager and the ultimate amount received in hand was such that no profitable activity could be carried out with it.
Then came the loan defaults and another round of bribing to ensure that the assets purchased with the loan were not confiscated by the bank. It was one big vicious cycle. The economic liberalization of the last two decades has on the surface changed all that. Today because of competition and the ending of the monopoly of the nationalized banks, the customer does not have chase loans; the loans come home. People will come and do all the paper work for you and give you the cheque with minimum hassle. It was a quantum jump from the days of queuing up before the bank manager.
I suppose the easy availability of loans enticed many to borrow with any due diligence being done at any level to ensure that the loans were not going to turn" bad". In the old days of the monopoly of the nationalized banks, this used to happen, especially in the infamous loan melas but there was a budgetary provision to write off bad loans in the social sector and there were always the bribes to the banker to keep the devil off the door.
These days, banks are more keen on clean and healthy balance sheets and so it seems that bribes don't work any more. The loans that have been taken have to be paid off somehow. What if you can't? Well then, the banks - the very modern institutions with swanky offices and air conditioned branches employ what they call "recovery agents" but what the ordinary citizen calls hoodlums and goons. They first make threatening noises on the phone, then they come knocking on your door and then still if nothing happens, something unpleasant occurs when you least expect it.
For instance, there is the recent case of a man who decided to commits suicide because he couldn't handle the pressure that the loan recovery representatives used by a private bank – ICICI Bank - was exerting. Now the bank will wash its hands off by saying that these folks were not bank employees but acting on their own. One may well question that if a Bank even outsources its dirty work to agencies which have these sorts of ethics, then what might be the difference between it and a Kabuliwallah money lender? Aren't they both equally extortionist?
Shantanu Dutta is a doctor by training and a development professional by vocation. He is an onlooker on events happening in India and the world and most of of what he writes is guided by the axiom WWJD - How would Jesus understand, interpret and write about the situation.
WWJD—What Would Jesus Do? Jesus already did it. He overturned the tables in the Temple. He said there should be no taxes on the children of God. He said lend and give without asking for anything in return—no recompense. He said to feed the people without charge.
Human kind has slid backwards from both the Old and New Testaments. The Old Testament said do not exact usury or gain from your brother in any form whether money or food or anything else. The New Testament extended the meaning of brother and neighbor to all human beings to eliminate hypocrisy. However, today, the wicked extract usury all over the planet defiling it and bringing closer the dark day of the LORD when the standard of the usurers comes back around to judge them.