NBFCs impound vehicles despite loan moratorium, BFSI News, ET BFSI

CHENNAI: Though the Reserve Bank of India’s loan moratorium period of three months is valid till August 31, non-banking financial companies (NBFCs) in Chennai have seized vehicles of loan ‘defaulters’. Vehicle owners, in a complaint, charged that the companies were using retired cops to seize vehicles to avoid intervention by local police.

A group of truckers, who claimed they were the most affected by such measures of NBFCs, have urged the director general of police (DGP) to form a separate cell or appoint officials to deal with such complaints across the state.

S Yuvaraj from Tamil Nadu Lorry Owners’ Association said local police had helped truckers a lot when such issues came up during the first wave. But they were not even accepting complaints now since retired police inspectors or assistant commissioners have been roped in by the finance companies and the deployed ex-officers work hand-in-glove with the local police, he charged.

“I was harassed continuously to pay the arrears. Even after paying back a portion of it, they seized my vehicle when I was not in town. They manhandled my wife and children when they tried to stop them. They threatened my guarantor that his properties would also be auctioned soon. He died of a heart attack last week.” said Rajaguru, a truck owner from Porur.

Rajaguru, who owns sand trucks, added that the lockdown choked the construction sector and that he hardly got bookings to move sand or cement. “Even then I sold gold jewellery of my wife and my mother to pay ₹5.5 lakh towards the dues. But the finance company is refusing to release my truck.” he said.

Yuvaraj added that finance companies were auctioning the seized vehicles at a much lower price than they could fetch in a hurry so that accounts could be settled. For instance, in Chennai, trucks worth ₹45 lakh were sold for ₹15 lakh last week, he said, adding that there was an urgent need to fix the minimum price for such auction vehicles.

Commenting on it, a senior police official said the RBI has already launched an online portal (https://cms.rbi.org.in) to file complaints against NBFCs along with necessary documentary evidences. “We have also advised the truckers to approach respective district superintendents of police (SPs) to look into such complaints.” he said, requesting anonymity.