Several PSUs Banks in India engage private recovery agents to recover unpaid loans from borrowers. These agents are often accused of using harsh and unethical methods—like threatening or harassing borrowers.
Since public sector banks are using the taxpayer money to pay these agents, public have a right to know about how much is being spent on these agents, how many are hired and are there fair rules for how these agents work. To uncover these India Today filed a Right to Information (RTI) query with the Department of Financial Services (DFS).
India Today asked major PSBs for their annual spending on recovery agents over the past five years. Many banks refused to share the information, saying it was confidential and related to their business. Most banks didn’t share the full details, and only a few responded with actual figures. As a result, India Today’s report doesn’t include the total amount spent by all banks, it mainly shows that many banks refused to share the information.
Punjab National Bank (PNB) and Bank of Maharashtra (BOM) shared detailed figures and policies for the past 5 years, showing how much they paid and how many agents were hired. Bank of Maharashtra, Central Bank of India, and Indian Bank shared partial details.
Most other banks either refused to share information, saying it’s a “trade secret” or “commercially confidential”. Others claimed they don’t keep the data in one place, so it would be too hard to collect. A few said the request wasn’t clear or wasn’t in the public interest. Even the State Bank of India, the country’s biggest public bank, refused to give the details, even after an appeal.
Why this matters?
Hiring recovery agents is a serious issue that affects millions of people, especially when things go wrong. Since this involves public money, people deserve to know the truth. But most banks are choosing to keep the system in the dark, even though transparency is possible.
Many banks are not being transparent, even though some other banks have proven that sharing this information is possible. By using reasons like “commercial confidence,” they’re avoiding public scrutiny. This means:
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There’s a lack of accountability.
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People don’t know how public funds are being spent.
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Borrowers are left in the dark about the rules and conduct of recovery agents.
Only a few banks are open and transparent, while most are secretive and defensive. This shows a serious lack of accountability within a system that is meant to serve the public interest. When most banks are not open and honest, it raises serious concerns about oversight, trust, and the integrity of financial institutions