Thursday, February 04, 2010

The debt collector’s story

A former bank manager, S.M. Dherendra, relives his experiences of repossessing cars and other assets from clients who defaulted on loan payments

By Shevlin Sebastian

S.M. Dherendra, the former collection manager of a private bank went to a house in Kottayam. Thomas Chacko* had taken a loan to buy a Maruti Zen. But owing to a job loss, he no longer had the money to pay the equated monthly installments (EMIs). Now there were seven outstanding EMIs.

“When I entered the home, I asked politely for the car keys,” says Dherendra. Thomas resisted. “I raised my voice and became adamant,” he says.

Thomas was about to give the keys when his wife entered the living room. She was nine months pregnant and pleaded with Dherendra not to take the car. “I might give birth at any moment,” she said. Recalls Dherendra: “I am a human being. So I left without taking the car.”

On another occasion, Dherendra informed K. Santosh*, who stayed in Changanacherry that he would be arriving the next morning to repossess the car since he had fallen behind in his monthly EMIs.

However, when he reached the house he was stunned to discover that Santosh, 73, had died of a heart attack during the night. “I gave my condolences to the family and left immediately,” he says.

Dherendra’s job is to collect the car, or any other asset, which has been bought on a loan, once the customer misses out on his EMI repeatedly. It is, as expected, not a pleasant experience for both parties.

“When I reach the house and the family members realise the reason behind my visit, the door is shut on my face,” he says. “Then they will go to the balcony and shout, ‘Why do you come home? Who has authorised you? We are going to call the police. You are threatening us.’”

Soon, the local people will gather around. Dherendra has to make a quick judgement. If the public shows support for the family he knows he has little chance of taking away the car. So he leaves. But thereafter the family is put under constant surveillance.

“What the family did not realize, when they opposed us initially, is that we have an extensive network of agents and observers who are able to keep an eye on the man’s movement, especially when he is driving the car,” says Dherendra.

The moment the man goes out in the car and it is parked somewhere, the collection agents rush there, open the car with a duplicate key and drive it away. Immediately, the police are informed. The next call is to the customer. Usually, he becomes furious. “It is understandable because we are humiliating him in front of society,” says Dhirendra.

Sometimes, the client goes to the bank and shouts at the staffers. Or he goes to the police station to lodge a complaint. “What the man does not realise is that he is a defaulter and we are just following the rules,” says Dherendra.

Incidentally, taking the car like this is not an illegal act. The agreement states clearly that, when there is a default, the bank can repossess the car from the premises or any other location.

“Till the loan is cleared, the company is the owner of the car,” he says. “The client is regarded as a user till the last rupee is paid.”

Most of the defaulting customers realise this. So, they quietly give the car keys. But Dherendra, who has traveled the length and breadth of Kerala, says that people behave differently in various regions.

“In Malabar, a violent place, the people are tough,” says Dherendra. “They are unfazed by demands for payment. There is a fear in us when we approach the defaulting customers. So we always take the help of the police or powerful political contacts.”

In contrast, people in places like Tiruvalla, Changanacherry or Pathanamthitta are polite and well-mannered. “When we tell them that our jobs are at stake if we don’t collect the car, they just hand over the keys,” says Dherendra. But things are different in Pala, where the clients are mostly businessmen and are tough as nails. “They are mentally strong and are not intimidated at all,” he says.

Dherendra did this job for 12 years and gave up. “I was changing as a person,” says Dherendra, who is now happily working in the real estate industry. “I had become arrogant and adamant. Sometimes I behaved with my family in this manner. So I felt it was time to quit. It was the best decision I took.”

(*: Some names have been changed)
(The New Indian Express, Kochi)


  1. Is he what we know as ‘quotation’ that specialises in motor vehicles only? The person who intends to own a car should buy it only with the funds he has with him in his SB account and never take a loan to buy a non productive item like a car which starts losing its value as soon as it is driven out of the showroom. The banks should stop lending to purchase something of which the value never appreciates, like a car.

  2. Good point, Nebu!