Govt didn’t ask coop banks to stop jewel loans: EPS

Chennai: Chief Minister Edappadi K Palaniswami on Wednesday denied that his government had ordered the cooperative banks to stop jewel loans. They were advised not to lend beyond the permitted limit.

“We have not asked the cooperative banks to stop giving any loans. It is wrong information,” CM Palaniswami said, while responding to a pointed question from the media at Krishnagiri on stoppage of jewel loans.

Opposition leaders including DMK president M K Stalin, AMMK general secretary T T V Dhinakaran and CPM state secretary K Balakrishnan had hit out at the AIADMK government on Tuesday over reports that cooperative banks have stopped jewel loans.

“The recent move by the RBI to take control of cooperative banks and that of the state government to stop loans will lead to decay of cooperative banking system and increase the sufferings of the poor,” Stalin said.

“During Covid crisis, the poor and the needy as well as the middle class depend on jewel loans to take care of their immediate needs of expenditures. Ordering such loans to be stopped is against anyone’s conscience,” Dhinakaran had said.

“There are several people who are suffering without any job and the government must continue to provide jewel loans,” Balakrishnan said.

“The cooperative banks have been only advised to lend within their permitted limits. Some banks tend to disburse all the money on their hands as loans. When depositors come and ask for their deposits, it becomes a problem,” the chief minister said, explaining the reason behind the advisory.

State food minister R Kamaraj too sought to dismiss reports about jewel loans being stopped. “No one has said that cooperative banks will not give jewel loans to farmers. No such announcements were made. This is false,” Kamaraj said, talking to reporters in Thanjavur.

“In some places, the allotment for jewel loans may be over. So, the bank authorities might have said so, when the farmers approached them. If there is requirement for loans, over and above the allotment, the authorities will discuss with the chief minister and facilitate disbursal of such loans,” he added.

But, a communication from the general secretary of the TamilNadu Coop Urban Bank Employees’ Federation to members sought to nail the state government.

“The office of the registrar of cooperatives has withdrawn the announcement asking co-operative banks to stop disbursal of jewel loans,” A Subramaniyan said in his letter.