4 microfinance firms booked after man dies due to ‘relentless pressure’ by agents: Police

The deceased, who had consumed poison on February 11, succumbed at a government hospital in Belagavi on Sunday night

A case of abetment to suicide has been registered against four private microfinance companies after a man in Belagavi district died during treatment days after he attempted suicide allegedly due to “relentless pressure” from microfinance loan recovery agents, police said on Monday.

Investigations revealed that the deceased had taken a ₹2.5 lakh loan. (Representational image)

“The deceased, who had consumed poison on February 11, succumbed at a government hospital in Belagavi on Sunday night. Based on a complaint filed by his wife, a case under BNS section 108 (abetment to suicide) has been registered against four private finance companies and private money lenders. Since the ordinance does not specify sections, we have booked the accused under BNS provisions,” Raibag police inspector Balappa Mantur said.

In the complaint, the wife said that private money lenders and financial institutions drove her husband to take this extreme step, as the recovery agents frequently harassed him over unpaid instalments, even threatening to seize household belongings.

“Investigations revealed that he had taken a ₹2.5 lakh loan, agreeing to repay it with weekly interest-based instalments. However, after missing three payments, loan recovery agents reportedly visited his house and pressured him to clear the dues,” Mantur said.

Belagavi superintendent of police Bhimashankar Guled said the police have notified all registered microfinance and private finance companies about the ordinance that came in effect since February 12, which imposes a 10-year prison sentence for violations. “Police officials across stations and divisions have met with finance companies to ensure compliance with the ordinance,” he said.

According to the ordinance, “microfinance institutions shall not collect any security from borrowers,” a move aimed at preventing the exploitation of vulnerable groups such as women, farmers, and self-help groups. To ensure transparency, it further mandates that “microfinance institutions must provide a written disclosure of interest rates to customers.”

The provisions classify such offences as “cognizable and non-bailable,” making it clear that “no police officer shall refuse to register a case against those engaging in coercive recovery.” Additionally, it authorises a deputy superintendent of police (DySP) or higher-ranking officer to file cases suo-motu against violators.