LOAN MELA a revolution

January 1982 I was called by Prime Minister Indira Gandhi. When I went there, a surprise was waiting for me. "I am making you a Minister," Indira Gandhi said. Before I could realize what was happening, she continued "I am giving you Finance Portfolio." 'Thank you', I said. "You know why I am making you Finance Minister? Banks are not giving loans to farmers, working class, poor, students, unemployed youth. This was one of the main reasons why I nationalized Banks. But even then, people are struggling to get loans. You have come from a poor family background. You have seen poverty. That is why I have chosen you. Nobody has bothered to help these people. I want you to do it," she said.

This is how and why I became the Finance Minister. None of the banking facilities were reaching the poor. People had to bribe Bank officials to get loan. Corruption was at its peak. I wanted to do something about it and I was determined. Slowly but steadily I started understanding the banking system and how it worked. I visited several Banks in the guise of a common man. Sometimes I used to land in Banks at 9 a.m. In some Banks, staff used to come to the Bank at 10a.m. Since I was in disguise, they could not recognize me. They used to spend lot of time in gossiping. They were not bothered about the waiting customers. They used to look at the poor with disdain. Many were not even ready to speak to them properly. In some Banks I saw staff watching vulgar pictures. When I used to remove my disguise, bank staff would get shocked.

I toured the entire country within months after becoming the Minister. Newspapers recognized my work and intention. "Poojary with his tours and surprise visits is trying to bring discipline among Bank staff,'' they wrote. I used to check ledgers personally to verify if the Deposit statements are being sent to the customers every month or not, pass books are being updated regularly or not. Union leaders were caught off guard by my action. ''Mad fellow' that is how they used to call me.

Banks were mandated to disburse loans to people from scheduled caste at one percent interest rate under the Differential Rate of Interest (DRI) Scheme. But the Banks had not disbursed even one percent of targeted loan under the Scheme. ''Why you people are not lending to the poor," I used to ask them. 'They don't repay',' Bankers used to reply and try to scare me stating that Banks will go bankrupt if they start lending to the poor.

But that was not the real reason. Few rich persons had availed around Rs.1.25 lakh crore loan from Banks at that time. No Bank had made any serious effort to recover that loan amount. Banks used to lend Rs 500 to Rs 700 crore to the rich. This resulted in reduced workload to the staff. The work would have been more if the same Rs 500 crore were to be given to one lakh people. This apart, the bank staff had to run around to recover the loan, collect Deposits and disburse loans. This was the real reason for stiff opposition to extend banking facilities to the poor.

The matter used to be discussed inside and outside Parliament. Newspapers used to carry reports about corruption in Banks. But nobody had taken any step in this regard. Then I decided to fight. To begin with, I realised how necessary bank reconciliation was. There was a need to ensure that Bank statements reach the customers on time. There were no Computers at that time. Banks used to send statements of accounts once in several months. Passbooks were not maintained properly. It was not an easy task to set these things right. It was like waging a war and I had made just made a beginning.

Bank Unions across the country opposed the move. I had to face stiff opposition. 'Janardan Poojary will make all Banks bankrupt', Bank Unions started alleging. But I was determined not to look back. I wanted to bring transparency in the process of lending by Banks. I was of the firm belief that the more secrecy you maintain in Bank transactions, there will be more scope for corruption. That is the reason I started Loan Melas. From Kashmir to Kanyakumari Loan Melas were held. I toured extensively in those days and made arrangements to provide upto Rs 5,000 loan to every poor person without seeking any collateral security. That time it was a big amount. Bank Unions strongly opposed the move. Bank staff resorted to protests. Opposition parties created a ruckus in Parliament opposing Loan Melas. My life was under threat.

Loan Mela was actually a war against corruption in Banks. There was no scope for corruption in Loan Melas as the entire process used to take place in front of the people. We had asked people to register complaints on the spot if any Official sought bribe to sanction loan. This instilled some fear among Bank staff. The situation reached a stage whereby people started coming forward to complain against corrupt staff.

Unlike now, the air connectivity in India was not that good then. I had to travel in trains, buses, cars and autos. Roads were also not good and dust was the biggest problem. But it did not deter me from visiting far off places. I had instructed Chairmen and General Managers of Banks to mandatorily attend Loan Melas. We conducted these Melas on a war footing. I used to be on duty round the clock and had kept Officers on their toes. I had strictly ordered them that my phone calls should not go unanswered no matter what time I call them. Though staff were somewhat angry with me, their wives were very happy as they were finding their husbands always at home after bank hours.

I ensured crores of poor got loans from the Banks under Indira Gandhi's 20-Point Programme. While giving loans, face, caste, religion, colour was not seen. Promoters of Banks were hesitant to give loans to their own community people. I did it with the support of Indira Gandhi. I got widespread appreciation from the poor.

A section of Bank staff and Unions spread rumours that Poojary will make all Banks go bankrupt. But I proved them wrong with facts and figures. "If you give Rs 100 loan to the poor, around 54 percent of people repay the loan before they get notice. Around 20 percent will repay immediately after getting notice. Bank staff will recover another 20 percent. Around six percent comes under scheme guarantee. For remaining 10 percent there is scheme guarantee. So Banks will not lose a single paisa," I explained to the people.

I also defended Loan Melas with an equal conviction. "Banks had given thousands of crores to the rich and industrialists. Industrialists owed Rs 2 lakh crore to the Banks.

Many industrialists, who took loans in the guise of starting an industry, had declared their Units sick and escaped from repaying the loan. But, the poor are not like these industrialists and the rich. They have commitment and they will repay the loans," I told MPs.

It was around the same time, I started getting threat calls. But I was not perturbed. In every nook and corner of the country, people were discussing about Loan Melas. People used to gather in huge numbers at Loan Melas. "Who will give you loan without Surety? If you go to the rich and ask for loan, he will ask you to work with him as a slave. But for the loan you are getting from Banks, Indira Gandhi is the Surety. Her Government is the Surety," I used to tell people while asking them to repay the loans.

One day, I was on my way to attend a Loan Mela in Mangaluru. A youth stopped my car. As I rolled down the window glass, he came near me and started crying. "Sir, I need money to pay my college fees. If I don't pay by tomorrow, I will lose my Medical seat,'' he said. His father was a journalist. I asked him to come to Circuit House at night. I called the Chairman of one of the Banks to the Circuit House. When the boy came, I asked him how many times he went to the Bank seeking loan. "Many times,'' the boy said. Then I ordered the Bank Chairman that he should give this boy loan by 9am tomorrow and send a report. The boy got loan the very next day.

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