Debt displacing poor households in Bara

Bara, June 19

The number of people, leaving their villages due to inability to pay back bank loan, and loan taken from other institutions, is increasing day by day in Bara district.

Shanta Pariyar and her husband Ram Kumar of Bara, Manaharwa have been out of contact for the past two months. The couple left their village after they defaulted on Rs 1.2 million, they owed to a number of financial institutions, namely Gramin Bikas Bank, Nerude Microfinance, Nadep, Deprox Development Bank, Swarojgar Development Bank, Mero Microfinance and Forward Microfinance.

“What could they do after the banks got on their back all the time asking them to repay the loans. The poor family has just a small strip of land and a small shack called home,” said Santalal Tamang, a local. This has left five of their children in the lurch. They are taking refuge with their kin and neighbours.

Koshila Chaudhary of Bhodaha, Kalaiya Municipality; and Ranjita Lamichhane of Dumarwana Gadhimai Municipality  too have left their villages after they  defaulted on loan they had taken in the past. There are many other families in Bara villages who have met the same fate. Nepal Gramin Bikas Bank Manaharwa branch chief Suraj Yadav reasoned that most of those defaulters had spent the borrowed amount on household expenses and other unproductive sectors.

“Some of them took loan to cover their household expenses, while others to pay back the previous loan. As the borrowed amount was not spent on the productive sector, it was natural for them to find it hard to pay back the loan,” he said.