IndusInd Bank on Saturday termed the whistleblower’s claims on ‘Loan Evergreening’ as “completely false and baseless” and admitted on Saturday that it had given loans to 84,000 customers in May due to technical glitches without their consent. A day earlier, it was reported that some unidentified whistleblowers have written to the bank management and RBI complaining that the bank’s microfinance focused subsidiary BFIL has done ‘evergreening loans’. Under ‘Loan Evergreening’, a loan is given to the existing customer even if the loan is not repaid. The private sector bank clarified that the field staff had informed the customers of giving loans without consent within two days, after which the error was rectified expeditiously.
According to the information, the unidentified whistleblower has written a letter to the bank management and Reserve Bank of India alleging loan evergreening of loans given by BFIL, a subsidiary of IndusInd Bank. Thus, where existing customers were unable to repay their loans, new loans were given to them, so that the books of account could be kept clean.
However, the bank has admitted that in May 2021, 84 thousand loans were disbursed without asking the customers. But this happened due to technical fault. The loans issued and managed by BFIL were granted only after fully adhering to the guidelines issued by the regulator. The bank said that in May 2021, due to technical glitches, about 84,000 customers were given loans without permission.