RBI's dual standards behind MFIs running rampant: Babu

Telugu Desam Party president N Chandrababu Naidu on Friday criticised the Reserve Bank of India for adopting double standards against micro finance institutions.

Talking to media persons at NTR Trust Bhavan before leaving for Medak district to disburse compensation to the next of kin of MFIs victims, Mr Naidu charged the RBI of failing to put a proper policy on interest rates in place, resulting in the MFIs remaining unchecked.

The TDP chief asked the RBI to frame stringent rules and regulations and harness the MFIs.

The former chief minister also vent his ire on the government by charging it of neglecting the hapless people who have fallen victim to the arm-twisting methods of the microfinance companies. He stated that the MFIs are resorting to manhandling their debtors who are unable to pay the loans taken with exorbitant interest rates.

The TDP chief also charged the MFIs of sucking the blood of poor and rural folk by charging high rate of interest and abusing them mercilessly by deploying agents. The hapless victims are ending their lives as the police are not booking any cases and taking action on MFI agents, he said.

Mr Naidu added that the government has lost control on the affairs of MFIs and washed its hands off the affair by just promulgating an Ordinance. Without fixing interest rates and regulatory measures, the Ordinance would not serve any purpose, he pointed out.

He also described the agents of the MFIs like a gang members of a mafia and vowed that his party would create awareness on MFIs issue among people and help them in living with self-respect.