Maharashtra Gramin Bank and Bajaj Allianz officials dupe debt-ridden farmers, promise crop loan only on purchase of insurance policy

Thirty-five-year-old Baliram Sangale applied for a crop loan in June 2018 with the local branch of Maharashtra Gramin Bank. The manager told him the disbursement is temporarily stalled. "I had submitted the required paperwork," said Sangale, a farmer based in Latur's Gutti village in Jalkot Taluka. "The sowing season had arrived, and I needed the money."

In October 2018, Sangale got a call from the local branch of Nalgir late evening. "They told me I would get the crop loan the next day," he said. "By midnight, I gathered the documents they had asked me to, and met the branch manager, Chaudhary saheb."

By October, the crops in Maharashtra's agrarian region of Marathwada — under which Latur falls — had dried up. The receding monsoons expected around the time of harvest had deserted the region, resulting in an underwhelming produce. Sangale was no exception. The sugarcane and soyabean he sowed in his four acres of farmland barely had any yield. In a decent year, two acres of soyabean amounts to at least 15 quintals of harvest. "I harvested about 3-4 quintals," he said. "I thought if I got the crop loan, it would be of some help in covering the losses in my farmland, and I could use the money to sow for the rabi season."

But Sangale was in for a rude shock. "Chaudhary started talking about a policy of Bajaj Allianz when I met him," he said. "I was told I would get the crop loan of Rs 1 lakh if I buy the policy with a premium of Rs 30,200 a year. I said it was idiotic to go for a policy when you are drowning in debt. How can a farmer afford to pay premiums?"

37-year-old Jaiprakash Kapse is one of the farmers, who wanted to start a business of his own, and was duped by Maharashtra Gramin Bank. Image/Parth MN

But Chaudhary said Sangale's crop loan was predicated on the policy. "I finally budged under pressure, and agreed," he said. "They cut the premium amount from my loan. Another bank official also got his cut, and I got Rs 65,000 in hand as crop loan."

Sangale had wondered why the bank suddenly called him up in October after denying him the crop loan since June. The suspense ended last week. On 16 January, 2019, Yogesh Shelke, former employee of Bajaj Allianz and a resident of Beed in Marathwada, blew the whistle on the nexus between Bajaj Allianz and Maharashtra Gramin Bank. They had a tie up, which meant the bank could sell Bajaj Allianz policies to its customers. But an overwhelming majority of the Maharashtra Gramin Bank's customers are farmers, who would not go for the policy for obvious reasons.

Chairman of the Maharashtra Gramin Bank, MA Kabra, said the tie up happened around March 2018, but the business "hadn't picked up, so Bajaj Allianz infused manpower since October." Shelke, in an emotional video which lasted over seven minutes, and has gone viral since, explained how the farmers are being looted. "If a farmer asks for a loan of Rs 1 lakh, he is compelled to take policies of Rs 20,000," he said in the video. "The manager would say so in as many words. And if the farmer refuses to budge, his signature is to be forged."

To prove this, Shelke reproduced a call recording between him and his manager Bhimsen Chandel, in which he is heard asking Bhimsen what to do about farmer's signature. "Manage it" is Bhimsen's instruction, "Can’t you sign?"

"I was forced to forge the signature," said Shelke, holding up 10 forms where he has forged signatures of farmers. "When I complained to my senior, Abhijit More, he asked me to go for the incentives. I am also a farmer's son. What if my father had to go through this? In today's times, Rs 20,000 is a big amount for farmers."

Shelke gave out his phone number and implored the viewers to share it as much as possible.

After an email requesting clarity on the internal investigation by Bajaj Allianz Life Insurance on 23 January, 2019, the company responded with an official statement the next day, confirming that Bhimsen Chandel's employment 'was terminated', admitting he indulged in fraudulent activities as claimed by Shelke. "Yogesh Shelke resigned on his own accord from Bajaj Allianz Life on 14 November, 2018. He did not raise any of the malicious issues he mentioned in the said video, during his employment or during the time of his resignation in November,” the statement added.

In the video, Shelke said he complained to the authorities at Bajaj Allianz. "I called Prerna Kalyani from Ahmedabad, who is the Zonal Manager at Bajaj Allianz. 'If Maharashtra's farmers commit suicide, it is not my concern,' she replied. Then I complained to the HR. We talked about farm suicides but how would the farmers live if we treat them like this?" he said.

The Bajaj Allianz statement said, "The Company has investigated and found no basis in the allegations made in the viral video that has been circulating. Bajaj Allianz Life sells life insurance policies through the retail branches of Maharashtra Gramin Bank and only offers savings and protection solutions to the retail customers of the Bank. These policies are not linked to any kind of loans. Bajaj Allianz Life Insurance will take appropriate action against people involved in the video, which appears to have been made with a malicious intent.”

In a telephonic interview, Shelke, who stopped being Bajaj Allianz employee since 17 December, 2018 when his resignation was accepted, said the company officials got in touch with him after he made the video viral. "They told me I would get all the incentives plus my salary up to 30 April without having to work in exchange of withdrawing my allegations against the company,” he said. “I refused to do it."

Responding to Shelke's allegations of a settlement offer, Bajaj Allianz's statement read, "Once the video emerged, Bajaj Allianz Life had initiated a detailed enquiry and also met with Mr. Shelke at our office, where he broke down while speaking about the video and was apologetic for his actions. During this discussion between the Company and Mr. Shelke, a mob barged in, and got Mr. Shelke to go with them. Since then, the company has tried to connect with Mr. Shelke, however, there has been no response from him or any other correspondence from him.”
Shelke, who earned a salary of Rs. 17,500, said he has been receiving threat calls since he made the video, and is scared. “I do not know who those people are,” he said. “I had sent the proof to the Gramin Bank’s Resident Manager in Latur, Ashok Gattani. He didn’t even ask me the details behind it."

Kabra said the bank has sent Shelke a legal notice for defaming Maharashtra Gramin Bank.

Speaking to Marathi channels, Gattani, in an attempt to defend himself and his branch manager Chaudhary, said Shelke is making baseless claims because he lost his job. "The customers have signed up for the insurance policy because they wanted to," he said. "Nobody forced them."

ABP Marathi's reporter, Rahul Kulkarni, asked Gattani which struggling farmer would go for an insurance policy when he is looking for a crop loan. "The farmers opt for crop loans every year,” he replied. “Those who liked the policy went for it."

The banks in rural areas have been under pressure to maintain non-performing assets. Most of the banks — cooperative and nationalised — in rural areas are financial skating on thin ice because the farm loan waivers and their inability to take on influential wilful defaulters, worsening their NPAs. Thrusting policies down the throat of its customers is one way of recovering bad debts.

Kabra said that the Maharashtra Gramin Bank has sold around 400-450 policies of Bajaj Allianz across 410 branches in 17 districts of the state, totalling around Rs 3 crore. "But there was no coercion," he said. "We have a tie up with LIC and Oriental as well. Our job is to educate our customers about a policy, and explain its benefits. It is not possible to compel anyone to buy the policy. Because we do the E-KYC, after which the head office of Bajaj Allianz gives the customer a call to verify the details, and only then the policy goes through."

But the farmers who bought the policy say the bank officials delay what their requirement is if they refuse to go for the policy, compelling them to play along. Thirty-seven-year-old Jaiprakash Kapse wanted to start a business of his own so that he can stop relying on his 2.5-acre farmland in Nalgir village of Latur’s Udgir taluka. "Farming has no future," he said.

"In 2016, I applied for a loan of Rs 25 lakh to start a mineral water plant through the Prime Minister Rojgar Yojana. It was approved by the Zilla Task Force Committee in October 2017, and the Gramin Bank received the proposal the following month."

Chaudhary asked Kapse about the security. He offered the fixed deposit of Rs 5 lakh he already had with the bank. "I was asked to make another FD of Rs 5 lakh," said Kapse. "I said it would be tough, but I will borrow money and do it."

Fifteen days later, the bank told Kapse he would have to make a third FD of Rs 5 lakh. "I said if I had that much money, why would I be standing here,” Kapse said. "After which the bank asked me go for a policy of Rs 5 lakh with a premium of Rs 1 lakh per year. I told them I couldn't afford it. Eventually, we settled for the policy with a premium of Rs 50,506 per year for a period of five years."

The loan still did not come through. Kapse kept running from pillar to post, when he was eventually told to re-apply for the loan by restructuring the quotation to Rs 10 lakhs instead of Rs 25 lakhs. "I did that too, but I have still not received any money," he said. "However, I am stuck with the policy."

In the meantime, after Shelke's video went viral, officials from the Nalgir branch of Maharashtra Gramin Bank are frequenting the villages of farmers who were deceived into buying the Bajaj Allianz policy. “A bank official landed up at my doorstep at 6 in the morning the other day,” said Sangale. “He asked me to write that I got the policy because I wanted it. I offered him tea, and told him I would not give anything in writing. I did not want that wretched policy. And I am not going to lie.”