KARACHI: Private lenders providing interest-based loans, would face strict penalties for harassing debtors after Governor Sindh Kamran Tessori signed the Sindh Prohibition of Interest on Private Loans Bill-2023.
The legislation envisages strict penalties for private lenders providing interest-based loans and later harassing debtors.
Under the new legislation, the private lenders will face up to five-year jail term and up to Rs500,000 fine if found guilty of harassing debtors. The legislation came in the wake of rising cases of suicide among debtors who acquired loans from private lenders also working through online loan apps for alleged blackmailing and harassment at the hands of the lenders.
Under the new law, the authorities can confiscate an individual’s property or seize a company for the crime.
Governor Sindh Kamran Tessori has advised the citizens to immediately inform the authorities in case they face harassment at the hands of lenders.
Debtor’s suicide
A few days ago, Muhammad Masood, a father of two, had committed suicide in Rawalpindi after being blackmailed by an online loan company.
The 42-year-old – a resident of Rawalpindi’s Chakra area – had acquired Rs22,000 from an online loan company. The people running the online loan company started blackmailing Masood. After going under stress, Masood committed suicide after recording an audio clip narrating his ordeal.
A case was registered at the Race Course police station on the complaint of the deceased brother.
The family said Masood had acquired loan from an online company which he failed to return in the given time. The online loan company continued increasing the interest rate and later they demanded millions in return.
