Gujarat police launch operation against private loan sharks; over 100 FIRs lodged

In an effort to combat private usurious money lenders, the Gujarat Police have initiated a special operation targeting those who charge middle- and lower-class families excessive interest rates.

As many as 134 FIRs have been filed in the special drive against 226 people who were lending money at excessive interest rates and subsequently harassing the borrowers.

The drive is planned to run until July 31. Following multiple suicides caused by harassment from the lenders, a crackdown has been initiated on the lenders.

“The state government has launched this special campaign against private money lenders under the Gujarat Money Lenders Act, 2011. In every district, the police have been holding special camps to call citizens who are facing harassment from money lenders,” said a statement from the state government.

“More than 32,000 citizens have participated in 568 public hearing camps across the state since June 21. The police have lodged complaints against the loan sharks and have also resolved the complaints of the citizens,” the statement added.

Harsh Sanghvi, the Home Minister of Gujarat, said that the police have been asked to tackle the widespread problem of money lending in their districts. The state government initiated a special operation to combat the mushrooming lenders who charge high interest rates to poor people.

The state has encountered cases of violence, rapes, and suicides because of these private moneylenders—some licensed, some operating without licenses—collecting illegal sums of money after lending money to the borrowers.

Police officials claim that the amounts being charged by the lenders are much higher than the maximum interest rate set by the state, which is 15% annually for borrowers without a security and 12% annually for those who have provided the security. Late payments are frequently subject to steep penalties and daily compound interest.