Bengaluru: A Day after Governor Thand Gehlot Rejected Karnataka Micro Finance (Prevention of Coercive Actions) Ordinance 2025, State Government Said Its Consers, Reworks Al for Approval Within a Day or Two.
Gehlot raised Concerns over Potential regulatory excesses and termed the proposed penal provisions – up to 10 years of imprisonment and Rs 5 lakh fin – dispartionate.
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He also suggested that state government introduce a Comprehensive Law in the Upcoming Budget Session Rather Than Rushing An Ordinance.
Home Minister g Parameshwara, Responding to Governor's Observations, Said, “He has made suggestions to take it up at upcoming legislature session begining Ports of Suicides and Harassment Cases due to microfinance lending Are Increasing Daily. “
Parameshwara defended the stringent penalties, arguing they serve as a deterrent. “The fin is imposed on that who commit Wrong.
Gehlot, while rejecting the order, had pointed out that the maximum loan amount under Microfinance Schemes is Rs 3 Lakh, Making a 5 Lakh Fine Excessive.
He also suggested that existing legal provisions under Karnataka Money-Lenders Act, 1961, Negotiable Instruments Act, 1881, Karnataka Debt Relief Act, 1976 and Karnataka POLICE ACHINATAKA ES to curb coercive recoverry practices. He stressed that Better Enforcement of these laws could regulate the sector more effectively.
Parameshwara Acknowledged Differences in Approach But Emphahsized The need for a dedicated law.
Karnataka government is now set to address the governor's concerns and resubmit the order, keeping its objective of preventing borrower harassment intact.
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