The Nagaland Pradesh Congress Committee on Friday said non-implementation of the Secularization and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002, will facilitate illegal money lenders’ market in the state.
PCC president K. Therie said denial of SARAFAESI Act implementation in the state will stop banks and financial institution from lending at cheaper rates.
It will also allow private money lenders to capture the loan market with the intent to capture the properties and businesses from those in dire need.
Therie said most private money lenders belong to “big corrupt politicians”.
Chief minister Neiphiu Rio in the Assembly recently said the Act cannot be implemented in Nagaland in its present from since it comes in direct conflict with the land holding systems and restrictions on transfer of land as provided in Article 371 (A) (special provisions on transfer of land and its resources), the Nagaland Land and Revenue Regulation (Amendment) Act, 1978 and Land and Revenue Regulation (Amendment) Act, 2002.
He said the rate of banks and financial institutions are within 8.50% to 12.50% annually, whereas private lenders charge 60-120% which is 500-1000% higher.
He accused the state government of deliberately keeping the Nagaland Money Lenders Act 2005 dormant to facilitate unauthorised and illegal money lenders.
Therie said the government has not appointed inspectors as provided in the Act to be vigilant with the application of the law.
Illegal and unauthorised money lenders are freely allowed to capture the properties because owners are unable to repay the high interest, he said.
He further said no clean business can make 500-1000% profit and still sustain.
The PCC chief said inability to avail benefits from banks and other financial institutions has seriously impacted the growth of economy and displaced many properties in Kohima and Dimapur.