31-07-2025
Micro-finance firms pushing people into debt trap: Economist
Patna: Economist Jean Dreze on Thursday alleged that there is no transparency in micro-finance companies, which have become very active in Bihar and Jharkhand of late.
"People have been taking loans on high interest rates from the micro-finance companies to fulfil even their basic needs.
Unable to repay the interest on the principal amount, the companies are charging interest even on the interest that gets accumulated, which, in turn, has been pushing them into debt traps," Dreze said, while addressing Karj Mukti Mahila Sammelan, organised by the CPI(ML) at Indian Medical Association hall here, on the birth anniversary of Hindi writer Premchand.
Dipankar Bhattacharya, CPI(ML) general secretary, said they would make the debt trap an election issue, as reports have been coming about the debtors committing suicides.
"The people of the country are getting increasingly caught in economic crisis due to lack of employment, but they are being subjected to communal disputes. Now, the people of Bihar have become victim of the special intensive revision of the electoral roll," he said.
All India progressive women's association national general secretary Meena Tiwari said that the micro-finance companies operating in Bihar had disbursed loans worth Rs 49,500 crore in 2023, a huge jump from Rs 6,000 crore in 2020.
A large number of women, who had taken loans from the micro-finance companies, narrated the tales of their woes.
