According to the RBI guidelines, " lenders should not resort to undue harassment - persistently bothering borrowers at odd hours, use of muscle power for recovery of loans, etc."

And maintaining that India is a civilised country governed by the rule of law, the apex court had barely two months ago reminded banks that they cannot de- ploy musclemen to recover loans, often pushing defaulters to suicide. The court's remarks had come in connection with the suicide of 34-year-old Himanshu Dev Sharma after he was humiliated by ICICI Bank's recovery agents.

That's not all. Only a week ago, the National Consumer Disputes Redressal Commission had noted: "In case of motor vehicle loans... the debtor/borrower is under constant tension that if he fails to pay one or two instalments, he would receive threats from so-called 'recovery agents' of the banks."

The national consumer court also took a dig at the RBI, saying: "The RBI has permitted banks to appoint 'recovery agents' on contract without per- haps fully appreciating the implications that these 'recovery agents' are usually musclemen, employing whom increases nothing but goondaism."

The central bank's guidelines permit recovery agents being hired but make banks responsible for their actions. Reiterating the RBI Guidelines on Engagement of Recovery Agents, the court on May 15 said: "The RBI may consider banning a bank from engaging recovery agents in a particular area... for a limited period. In case of persistent breach of the above guidelines, the RBI may consider extending the ban."

It is high time the RBI takes note of frequent violations of its guidelines and disciplines erring banks.