GUWAHATI, April 30 � Alleging that lack of timely action on the part of the State government resulted in the mushrooming of chit funds, cheating people of their hard earned money, the Bank Employees Federation (NER) has asked the government to regulate chit funds to control further damage.
The association asked the Reserve Bank of India, SEBI, Department of Company Affairs (Government of India) and intelligence agencies including revenue intelligence to book the culprits involved in the multi-crore scam and refund the money to the depositors.
The federation further rapped the Union government for systematically weakening the public sector banking system, for which people are turning to the fake financial institutions.
�Mushrooming of chit funds has eroded various small savings schemes of the Central Government from which 75 per cent go the State Government as loans for their respective developmental activities. Alarming reduction of receipts on this account in the last couple of years was enough to arouse serious concern and for taking up effective remedial measures by the State government,� the federation said.
�Despite the assurance of regulating chit funds in the State Assembly, government turned a blind eye to this problem and cases by companies like Jivan Suraksha Group, Rangdhali, Unipay and Saradha Group came to light,� it added.
It further added that RBI�s new Bank Licencing Policy might provide an easy route to the unscrupulous chit fund operators to divert line of business to private banking even if the chit fund business itself is outlawed.
�According to new policy, any private entity with minimum Rs 500 crore will be at liberty to open a new private sector bank, out of the said initial capital, the promoters have to initially infuse only 40 per cent or Rs 200 crore, which could be brought down to 15 per cent, after first five years. So, the promoters of any chit fund can garner Rs 200 crore very easily by opening a private bank,� said the federation asking the government to strengthen public banking sector and RBI�s regulatory and supervisory role.