Bandhan Bank Issues Clarification On Certain Allegations BQ Prime Flagged

Bandhan Bank has issued a clarification on allegations made by BQ Prime, flagging certain allegations about various business procedures followed by the Bank. The details were shared through the exchange filing.

On April 10, BQ Prime wrote an article titled, "The Curious Case Of Bandhan Bank's 'Creative' Growth Tactics", stating that "Practices followed by Bandhan Bank could constitute ever-greening of loans and violations of the spirit of RBI norms." Therefore today 11, April, 2023 in the morning the bank issued a clarification for the same.

According to the filing, "We strongly and unequivocally state that the allegations flagged by the said article are completely false, baseless and misleading in nature."

Further it explained and stated that, the Bank has a very robust credit policy for all kinds of lending products including Microfinance Loans. The eligibility is ascertained as per the Credit Policy of the Bank and in line with the microfinance guidelines introduced by the RBI on April 01, 2022. Any loan is disbursed only after thoroughly assessing the creditworthiness of the borrower, which in no case exceeds the loan applied for by a borrower.

The bank also mentioned that, it is in compliance with the applicable RBI rules and regulations. It also follows the highest standards of disclosure norms with all the relevant stakeholders. "We wish to clarify that deposits from micro-credit customers is only about 4% of the Bank's total deposits as on Q3 FY23 and is stable around the same level for the last several quarters."

Bnadhan Bank notified stating that, there is, under no circumstances, any difference between the sanctioned and disbursed amount for microfinance loans. Also, there is no such process or mechanism where the Bank withholds any disbursed amount in the savings bank account of the applicant.

Finally bank has asked "we reiterate that the said media article is baseless, malicious and far from the truth. You are requested to take note of the above."