Thumbprints of borrowers a must now

The country's central bank has now made taking thumb impression on loan documents mandatory for non-bank financial institutions (NBFIs) to ensure smooth recovery of depositors' credit.
The Department of Financial Institutions and Market (DFIM) of the Bangladesh Bank (BB) issued a circular to this end on Monday.
It stipulates that a loan borrower and a guarantor must give thumb impressions of their both hands along with signatures for obtaining any loan.
The non-bank entities will then verify the impressions from the NID database.
Referring to a recent observation of the High Court, the circular noted that many guarantors and borrowers earlier denied their signatures on loan documents.
In such situations, the court had to depend on borrowers' signatures. Even it took time to prove whether the signatures were genuine or not.
As a consequence, commercial banks faced troubles in recovering the loans.
Md Sarwar Hossain, assistant spokesperson for the BB, spoke of many past instances that the guarantors in the courts denied their signatures on such documents.
The courts could not prove the signatures, ultimately prolonging the loan recovery process, he said.
"Both borrowers and guarantors will read loan documents carefully and then sign and give thumb impressions on the papers," Mr Hossain told the FE.
On August 02, the central bank issued another circular, making it compulsory for banks to take thumbprints on the same ground.

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