Schools in Karnataka Harassed for Non-Payment of Loans, Seek Government Intervention – Edexlive
Several schools in Bengaluru have raised allegations of harassment by an NBFC (non-bank financial company), for non-payment of loans as they have been affected by the pandemic.
While two schools have made allegations, they claim that several schools, particularly in Devanahalli and Anekal taluks, are suffering from continuous harassment from NBFC Varthana Finance, a school loan provider, also known as of Thirumeni Finance, based in Bengaluru.
SK Public School Principal Ajjappa said, “There are several schools like ours, which took out loans before the pandemic, but due to the closures, classes have been moved online and there are had a drop in student enrolment. This led to a drop in tuition collection. As a result, we were unable to maintain monthly payments.” He added that many schools in the taluks had appealed for help against the loan provider.
Another school, which is part of St Mary’s Educational Society, had written a letter to the Karnataka Associated Management of Schools (KAMS) about the harassment they were facing.
Following the non-payment of the loans, the NBFC attempted to auction off the mortgaged land, but failed to attract buyers. The schools had approached NBFC on several occasions with potential buyers to settle the loan amount, while waiving interest accrued over the past two years. The accumulation of interest had considerably increased the amount of the loan compared to the amount initially sanctioned.
St Mary’s Educational Society Secretary Mathal TY said: ‘It is difficult for the school and my family as the company has threatened to hire thugs to forcibly close our schools. attention to help solve the difficulties faced by private schools due to debt.”
KAMS has written to Chief Minister Basavaraj Bommai to seek his involvement in calling a meeting with private loan companies and NBFC and also to ensure the protection of educational institutions.