'Securitisation Act needs to be plugged'

Rajeev Chandrasekar, Rajya Sabha MP, has called for plugging the loopholes in the present Securitisation Act, given the backdrop of the various alleged instances of harassment by banks to its borrowers.

"This whole area of banks conduct of loan recoveries is very poorly regulated or not regulated at all. It is obvious that few banks and others are continuing to use elements that have links to criminal underground to undertake this loan collection activity. It is obvious that willingly or unwillingly these banks are funding the criminal elements in our society," he said.

He has further urged the Centre to review this issue and initiate changes in the law to ensure that lenders are obliged to operate under the framework of law.

"Given the reported recent trend of reckless consumer lending and credit growth, there is a growing and inevitable consequence of an increase in consumer delinquency which will in turn lead to more such instances. This cannot be allowed to happen by any government," he added.