With high defaults and slow income growth, some lenders are resorting to harsh reparations, according to associations working with taxi drivers.
Shaik Salauddin, national secretary general of the Indian Application-Based Transport Workers Federation, of which more than 20,000 taxi drivers are members, said lenders are taking large numbers of cars.
Over the past six to seven months, more than 6,000 vehicles in India have been confiscated by financiers for non-payment of dues, he said. Salauddin added that business is still close to zero and the situation is dire for taxi drivers due to growing debt. Many of them have already lost their cars to creditors in the recovery process, he said, while others are pawning gold and selling household items to pay off their loan installments.
BloombergQuint was unable to independently verify these numbers.
Both Narayan and Iyer said lenders were trying to be patient.
“It may be another month or so before the box office sees any improvement in the taxi segment. But we are trying our best to give borrowers more time to repay, and no vehicles have been seized from our side, ”Iyer said.
SBI’s Narayan also said the lender is giving its borrowing taxi drivers more time to pay off and is not yet resorting to auctions. “With all this, SBI was very lenient in this regard. SBI would not want to report that when people are in such a big disaster, we go out and auction their cars. We will wait, ”she said.
However, according to Gala, the seizure of vehicles may be inevitable, as otherwise the options for return are limited.
Cab aggregators didn’t help much either, Salauddin said.
However, in a written response to a BloombergQuint inquiry, an Uber spokesperson said that in April this year, the company provided its drivers with cash benefits of Rs 18.5 crore in the time they spent on vaccinations, in addition to free online medical advice and partial earnings support for those with who suffers from Covid.
Uber, however, did not respond to inquiries regarding the extent of its fleet reduction or the number of taxi drivers who took out loans to buy their cars and saw their cars taken back.
Ola did not respond to any of the BloombergQuint queries.