The Nepal Weekly 
April 4, 2023
The Government of Nepal has inked a five-point agreement with the loan shark victims on Saturday. The government authorities have convinced the victims to end the weeks-long demonstrations in Kathmandu.
The agreement was signed in presence of Deputy Prime Minister and Home Minister Narayan Kaji Shrestha and Home Secretary Binod Prakash Singh.
Part of the agreement mentions that the government would establish a high-level commission to study the reports of fraud in loan agreements where lenders make illegal interest amounts. All such will be reformed and illegal interest rates will be considered as criminal activity. Likewise, chief district officials would be authorised to look into reports of such cases at the district level.
Earlier, Prime Minister Dahal had directed officials to draft a bill to address this problem so that the government could endorse it from the parliament through a fast track.
The loan shark victims, mainly residents of districts of the southern plains, say that the lenders have been charging them millions of rupees in compound interests calculated in an unfair system which is locally called ‘meterbyaj’.
Speaking on the excesses of the loan sharks and need of regulations at Thursday’s National Assembly meeting, National Assembly member Dr.Bimala Rai Paudyal has asked the political parties not to protect the loan shark business. She said that the victims are saying that the loan sharks are being protected by political party workers and administrators. Dr Paudyal also expressed displeasure over the denial of Kathmandu Metropolitan City (KMC) to stay in Khulamanch, Tundikhel area.
Loan shark victims from different districts of southern plain districts gathered in Kathmandu to for around a week to press the government for justice.
The demonstrators spent their Monday night under the open sky. They tried to set up a camp at Khulamanch, but KMC did not allow them stay at the Khulamanch.
Another group of victims expressed dissatisfaction saying the latest agreement also could turn to be a lingering tool. They recall that loan shark victims from western Terai were demonstrated in Kathmandu and demanded the Government to act immediately against the loan sharks victims. An agreement of similar nature was also signed between the Government and demonstrator on 17th September last year. Moreover, the victimised party involved in the last agreement was kept aside while signing the fresh agreement.
The action committee has demands with the Government to declare ‘illegal’ all such documents related to usury, stop the case related to such transactions filed in the courts, review the verdicts against the loan shark victims and assessment of property of the loan sharks.
The practice of lending money at unfairly high interest rates has continued to take its toll on many poor people in the country. The Federal Government has now decided to advance the process of amending the Criminal (Code) Act, 2017 to criminalise the act of usury. The problem seems to have been widespread in the Terai region for years. However, the wretched people living in the hilly and mountainous regions have also not been free from this practice. A large number of victims had been raising their voice against the loan sharking since long time back.
It is said that the MoHA has received as many as 3,351 complaints against the loan sharks from across the nation so far. Some 525 complaints have to be looked into by the district courts. The police administration has settled about 850 cases of usury under mutual understanding. Some 1,181 complaints are now under investigation and 744 complaints are in the process of being probed. Only 35 cases have been resolved as of now.
