State-run lender Punjab National Bank is expected to recover around Rs 1,800 crore from its non-performing assets (NPAs) recovery mechanism — “Mission Gandhigiri” — which will soon complete one year of operation.
A senior bank official told IANS the mission, was launched in May 2017, had consistently delivered positive results with an average recovery of Rs 150 crore from the initiative.
“The mission was born out of the need to name and shame defaulters to increase societal pressure and urge them to pay back. Mission Gandhigiri has a dedicated recovery team across all circles of the bank,” the official, who did not want to be named, told IANS.
Accordingly, the passive recovery mechanism entails the team members to “visit the borrowers’ office or residence and sit their silently with placards that have hard-hitting messages such as ‘It is public money, please repay the loans’.”
On the legal side of the operation, following the government’s directions regarding wilful defaulters, the bank has declared 1,084 wilful defaulters.
“Due to PNB’s aggressive stance towards wilful defaulters, 150 passports have been impounded over the past few months,” the official said. Additionally, over the last 9 months, the bank has also lodged 37 FIRs against defaulters.
The bank is also leveraging data analytics for loan recovery and risk management.
“We have tied up with a leading credit agency and with the help of a third-party expert analytics, we will now be able to get access to contact information of PNB defaulters who have good credit record with other lenders,” the official said.
“This partnership is a part of the larger strategy to deploy technology to strengthen internal systems. This partnership will not only help the bank with loan recovery but will also help identify and automate profitable lending strategies and minimise credit and fraud risk,” the official said.
The bank has also recently started works towards “improving internal systems by incorporating analytics and Artificial Intelligence for a reconciliation of accounts”.
In addition, two special OTS (One-Time Settlement) schemes have helped the bank to accelerate NPA recovery.
“From an average of recovering loan amount from 70,000-80,000 NPA accounts in a year, this move has resulted in a recovery in 225,000 NPA accounts over a span of 10 months,” the official added.
“These schemes apply to small NPA accounts helping defaulters come out of debt.”