Do banks apply differential treatments while giving loans to sensitive customers?

Prime News, National, Banking, Finance, New Delhi, Dec 1:- Finance Minister Nirmala Sitharaman on Tuesday (November 30) informed Parliament that the Centre has issued no specific directions to banks asking them not to give loans to “sensitive customers” like police personnel.

Sitharaman, during Question Hour in the Rajya Sabha, said there is no “official stated policy” directing banks not to give loans to certain categories of customers.

“Banks make assessments based on KYC and other ratings like civil ratings. I don’t think any specific instructions are given to banks — please be careful not to lend to these people,” she said in the Upper House while responding to supplementary queries.

However, banks do exercise a certain level of discretion based on their available KYC (know your customer), she added.

What MoS (Finance) said on the issue?

Minister of State for Finance Bhagwat Kishanrao Karad said banks do have “problems” in lending to police and politicians. Banks see track record before lending to these customers, he added.

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