Loan Recovery Stalled as 70,000 Cases Pending in Artha Rin Adalat

The recovery of defaulted loans in Bangladesh is being severely obstructed due to stay orders issued by courts in cases filed under the Artha Rin Adalat (Money Loan Court). As a result, banks are increasingly burdened with unrecoverable debts, while the number of unresolved cases continues to mount.

According to Bangladesh Bank, over 250,000 cases have been filed in the Artha Rin Adalat to date, out of which more than 70,000 cases remain pending. The outstanding loan amount involved in these cases has exceeded ৳2.32 trillion (Tk 2,32,000 crore).

Current Case and Recovery Situation

Legal experts state that at least 1,700 individuals and institutions, despite being loan defaulters, have obtained stay orders from courts. These orders effectively stall loan recovery proceedings, leaving banks without legal recourse to reclaim the owed amounts.

Bangladesh Bank spokesperson Arif Hossain Khan commented on the situation, stating:

“We are actively considering legal measures to ensure that no genuine defaulter can continue financial operations solely by exploiting legal protections.”

He emphasised that the central bank is looking into how to prevent abuse of the legal system where defaulters maintain operations by simply securing court stays.

Expert Opinions on Legal Gridlock

Prominent economist Dr. Toufic Ahmed Chowdhury said:

“It should not be possible for someone to be declared a defaulter and then easily get a stay order from a normal court. Once a case is lodged with the Artha Rin Adalat, it should be resolved within that legal framework and within a stipulated timeframe.”

Barrister Syed Mahsib Hossain, a corporate lawyer, echoed the concern:

“Government-appointed lawyers often do not oppose the stays actively. Once a party secures a stay from the High Court, it tends to remain effective even beyond auctions or post-judgement periods.”

Suggested Remedies by Analysts

Experts suggest that to resolve this legal bottleneck and accelerate the loan recovery process, the following steps are necessary:

• Establishment of a special bench in the High Court to handle Artha Rin Adalat-related appeals and stay orders.
• Increase in the number of Artha Rin Adalat courts to reduce case backlog.
• Reform of existing financial laws and ensuring swift enforcement.
• Appointment of more active and trained government lawyers to contest stay applications effectively.

Unless these reforms are implemented, analysts warn that defaulted loans will continue to grow, threatening the stability of the financial sector and undermining public confidence in the banking system.