NO one can deny that high rate of bank interest is hurting our economy and discouraging new investment. Commercial banks are also charging fees on other accounts that impede industrial growth and make the growth process sluggish. Commercial banks charge US$ 50 to issue a simple foreign demand draft when they release an LC payment. Banks also deduct discrepancy charges for inadvertent errors in submitted documents. Whereas banks are supposed to be supportive of the industrial sector, they behave the other way round. Image of banks has been sufficiently tarnished due to various scams in banking sector and the confidence level of the aspiring entrepreneurs has already hit the rocks. In a situation like this, it is not fair to charge 10 to 11 per cent interest rates whereas they pay to their clients a profit of only 3.0 to 5.0 per cent for their deposits. It is imperative that the gap between lending and borrowing rates were reduced to allow the economy gather momentum.
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