Corruption in Rural Banking: Don’t Say ‘Bribe’, Say ‘Commission’

 About the Video: Small farmers in the village of Bithiya in Palamu district who  apply for loans at the regional bank are being cheated by touts acting as agents who are hand in glove with the Bank manager.  It is a common scenario in rural India where a bank loan comes with an illegal deal in which sometimes more than 40% goes towards so-called ‘commission’. Villagers who have asked for Rs. 25000/- have received only Rs. 15,000 and have been asked to pay the loan back with interest on the whole 25k. 

The Government has actively promoted rural banking with a view to raise standards of living, promote rural industry and alleviate poverty. It was also meant to provide a sustainable alternative to the traditional moneylender who gives out loans at sky high interest rates which leaves the lender going deeper down the spiral of debt until he has nothing left with him.  While rural banking has been successful in meeting some of these objectives corruption, inefficiency and favoritism continue plague the sector. 

Until Community Correspondent Anil Guria offered to give the voices of Bithiya village a platform to express their woes, the villagers were silently suffering under the corruption and say that they did not know whom to turn to. 

Anil Guria hopes that his video will be able to help the villagers get justice and says that the only way of tackling such institutionalized corruption is to create aware and empowered consumers who know their rights. If banks need their customers to believe in them, they need to create an environment where this belief can be anchored and fostered. 

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