People’s Bank is also pushing the law.
At some of the People’s Bank branches, it is reported that borrowers are facing severe difficulties. It is reported that various threats are being made to the creditors, especially using the illegal means to be taken against the defaulters. A number of such incidents are reported to us.
According to the existing law in Sri Lanka, persons who have defaulted on loans should be prosecuted in the District Court and the money recovered. Otherwise, it is prohibited by law to harass, threaten, harass or block the recipients of their wages by filing false documents and using various tactics.
Guarantors are only liable to pay the amount if the debtor dies. Otherwise the guarantors will not be liable for the payment while the debtor is still alive. When debtors default on loans, it is illegal to harass and harass the guarantors. It is reported that the People’s Bank is acting without any hesitation, despite the Central Bank order prohibiting borrowers from having legal repayments until December 31, 2021. It was also reported that the Central Bank has extended the order until March 2022.
These breakdowns have taken place in many places due to the ignorance of Sri Lankans about the law and the lack of backbone and personality to stand up for their narrow goals through various tactics. This is due to the fact that the bank officials do not know the law and do not do it even though they know it.
What to do if a bank pressures you to default?
You have to pay the debt anyway. But if you do not repay the loan due to the fault of the bank or the financial institution, you can ask the bank for compensation in a lawsuit filed by the bank and there should be evidence to show it. If you have been threatened by bank officials, you can go to the police with evidence and report to the Human Rights Commission within a month if it is an act committed by a state bank.
If the guarantors have committed various misdeeds by the banks or other financial institutions by filing bad records, action should be taken against those persons and institutions as before. Otherwise, the guarantor has no legal right to influence the debtor through the institution in which he works or by any other means, and the debtor has legal provisions to seek legal redress against both the guarantor and the debtor if various threats are exerted. The guarantor cannot influence the debtor and can not be threatened by bank officials and other means.
Also, in the case filed against the debtor, the bank can also sue the guarantor for the inconvenience caused to the guarantor and recover the loss incurred by the plaintiff.
If someone acts outside of these methods or uses other tactics thinking that doing so is a nuisance, they are all illegal activities. Also, if we have any influence on the debtor, the debtor can recover the damages from the guarantor.
