Corruption in Banking - Inputs Needed on Solutions
Below are the key issues and root causes as identified by you in the Banking Sector. Kindly help identify specific solutions that can be proposed to the regulators and Finance Ministry for implementation to reduce Corruption in Banking.
We look forward to your inputs!
Transparency International India
Corruption in Banking – Root Causes
1. Bank employees find loopholes to play with the rules
2. Bank officials take bribes to make extra money and don’t care if the bank loses money
3. Middlemen are used to ask for bribes so that the bank officials don’t get involved directly
4. Banks target needy customers who approach the bank and upsell to them forcefully
5. Small customers cannot pay bribes and hence the loan process is tough for them
6. The banking officials lack accountability
7. Honest bank officers are not able to perform due to pressure from other employees
8. Corrupt officials, usually in higher positions in the banks, often use their influence on junior managers to recommend such loans
9. The entire banking system is non-transparent
10. The rules and regulations are tough to interpret for the common man.
Corruption in Banking - Key Issues
1. Floating money in banks is being used by bank staff to invest in small finance companies privately to earn extra cash for themselves
2. Non-recoverable loans given by the government banks to known bad businesses (in exchange for kickbacks) eating away the huge profit of the banks
3. Asking for bribes for approving project loans is being done regularly. They usually name an auditor who tells the amount
4. They also pick flaws in the proposal to create a problem and then ask for the amount
5. Valuations for property is another area of corruption
6. The bank manager suggests the valuer you should approach. The valuer's fee has a cut for the manager. If you also do a deal with the valuer, your valuation and loan gets accepted faster
7. Banks give a locker only if we buy one of their policies or make a FD
8. Corruption also exists in posting /transfers at all levels
9. It has become a common practice among several banks that they route all paper work starting from Loan application filling to project report preparation to an agent, who will collect some fees as a percentage of loan sanctioned and the same is shared among that agent and bank officials
10. Bribe givers compete between themselves to offer bribe and corner loans with less or no collateral
11. CA firms develop relations with the bank’s credit officials and then exchange favours
12. Many branch managers provide cheque discounting facility without permission from Head Office or Divisional Office and get cheques deposited to improve their business
13. Banks verify and make loan process hell for agriculture and small consumer loans but large corporate loans are extended for chronic defaulters. more
We look forward to your inputs!
Transparency International India
Corruption in Banking – Root Causes
1. Bank employees find loopholes to play with the rules
2. Bank officials take bribes to make extra money and don’t care if the bank loses money
3. Middlemen are used to ask for bribes so that the bank officials don’t get involved directly
4. Banks target needy customers who approach the bank and upsell to them forcefully
5. Small customers cannot pay bribes and hence the loan process is tough for them
6. The banking officials lack accountability
7. Honest bank officers are not able to perform due to pressure from other employees
8. Corrupt officials, usually in higher positions in the banks, often use their influence on junior managers to recommend such loans
9. The entire banking system is non-transparent
10. The rules and regulations are tough to interpret for the common man.
Corruption in Banking - Key Issues
1. Floating money in banks is being used by bank staff to invest in small finance companies privately to earn extra cash for themselves
2. Non-recoverable loans given by the government banks to known bad businesses (in exchange for kickbacks) eating away the huge profit of the banks
3. Asking for bribes for approving project loans is being done regularly. They usually name an auditor who tells the amount
4. They also pick flaws in the proposal to create a problem and then ask for the amount
5. Valuations for property is another area of corruption
6. The bank manager suggests the valuer you should approach. The valuer's fee has a cut for the manager. If you also do a deal with the valuer, your valuation and loan gets accepted faster
7. Banks give a locker only if we buy one of their policies or make a FD
8. Corruption also exists in posting /transfers at all levels
9. It has become a common practice among several banks that they route all paper work starting from Loan application filling to project report preparation to an agent, who will collect some fees as a percentage of loan sanctioned and the same is shared among that agent and bank officials
10. Bribe givers compete between themselves to offer bribe and corner loans with less or no collateral
11. CA firms develop relations with the bank’s credit officials and then exchange favours
12. Many branch managers provide cheque discounting facility without permission from Head Office or Divisional Office and get cheques deposited to improve their business
13. Banks verify and make loan process hell for agriculture and small consumer loans but large corporate loans are extended for chronic defaulters. more
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Instead of looking for solutions for corruption based on sector. 1. Make anti-corruption a profitable business entity. Those who reported corrupt practices get 20 - 30% of the revenue recovered. Amend laws accordingly. This is like panama leaks team with booster packs. Few NGOs' are fighting, most of them do not have deep pockets. Most of the CAs', company secretaries and lawyers know the corrupt practices. The moment you put a reward system (and make it work) CAs', lawyers are going to join. Reward they get is going to be much higher than what they would get by way fee. In a way we are increase cost of corruption. 2. For every bank account, Aadhar/PAN is being (defacto) made compulsory. For every piece of real estate - unique number should be given and it should be linked to Aadhar. Not only for new deals but existing property it should be made mandatory/compulsory. Govt. should give incentives like reducing stamp duty for Aadhar linked properties. Bank route is more or less closed. If real estate route is closed. Where would the corrupt hide the money? Jewellery, physical money (with demonetisation there is fear). Increase cost of corruption. Taking baby steps are NOT going to help. We will continue to talk till cows come home. Above steps must be implemented to reduce corruption. more
Aug 05
I have only one Question..... .... is Govt or Political leaders really don't know about how to stop the corruption / how to make the corruption free country ????? more
Nov 15
Super fast charges in Indian Railways Trains are labeled super fast and each passanger has to shell out charge for it unnecessarily. Look back at many super fast trains. They take nearly same time to reach the destination ten years back too. THEN WHY SUPERFAST CHARGES ? more
Jul 24
I have bank accounts in ICICI and SBBJ where I get my work done within reasonable time without anybody asking for bribe. more
Jul 17
Blame the selection board who selects a individual or a professional who bribes tones of money to the finance minister and the selection board. No doubt, the newly appointed top notch will definitely secure his money spent on the corrupted finance minister and to the selection board. This fact is an open secret and know to the top judiciary. Why no stringent action not initiated till now. These newly appointed officials certainly lent loan to sick companies and/or to the willful defaulters. By the time repayment becomes a problem, the sanctioned officer either must have retired and/or died, so the case can be kept in abeyance, and subsequently squashed up. more
Jul 16
