Hubballi (Karnataka), Jan 23 Former Karnataka Chief Minister and BJP MP Basavaraj Bommai has accused the Congress-led state government of losing control over microfinance institutions (MFIs), leading to widespread harassment of vulnerable citizens.
Addressing the media here on Thursday, Bommai alleged that microfinance agencies were resorting to extreme measures, including forcibly seizing even mangalsutras from women. This exploitation, he claimed, has driven families to abandon their homes, with some even taking their own lives.
"The government is failing to enforce the law. There is no fear among these institutions, and rowdy elements are being allowed to carry out collections," Bommai said.
He criticized the government for its contradictory stance, mentioning that while it claims to support women-centric programmes, it is unable to curb the harassment perpetrated by some microfinance companies.
Bommai recalled a law introduced during H.D. Kumaraswamy's tenure as Chief Minister to regulate high-interest lending practices. However, the legislation was stayed by the court. He urged the current government to take steps to lift the stay, impose stringent regulations, and reclaim control over this sector.
Meanwhile, Karnataka Home Minister G. Parameshwara acknowledged the issue, stating that the Finance Department must act against MFIs operating without proper licenses.
“We are not fully aware of unlicensed microfinance companies in the state, but the Finance Department must intervene,” Parameshwara said on Wednesday. He assured that complaints from affected people would prompt immediate action and investigation.
The minister also noted recent incidents linked to MFI harassment. “A woman in Tiptur town of Tumakuru district committed suicide due to harassment by MFIs. Similar cases have been reported in and around Tumakuru. We have registered cases and initiated legal action,” he said.
Parameshwara stressed the need for preventive measures but admitted that proactive monitoring is challenging. “Guidelines exist for microfinance businesses, but violations, especially by unregistered entities, cause problems. Innocent people often invest their money and get trapped. Whenever such violations come to our notice, we will act decisively,” he said.
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