Loden resorts to legal recourse to recover interest free loan
Loden was forced to take its first legal case for loan default due to gross negligence. Among the entrepreneurs backed with interest free loan in 2008, Tandin was offered Nu 0.8 million, which was the highest amount of the loan, to enhance his musical production. He was observed to be one of the resourceful and competent entrepreneurs having produced most over 80% of music for Bhutanese films and received a prize for the best music production.
Moreover, Tandin did not take up Loden’s suggestion to hire a good business manager and repeatedly failed to pay back his loan on time. Despite the repeated notification and offer to help him get back on his track, Tandin showed poor cooperation and gross negligence. Loden eventually decided to take legal action. The court ordered Tandin to pay the outstanding loan with penalty and also return the equipments bought through Loden’s loan.
Dr Karma Phuntsho, the co-director of the Loden Foundation says, “we don’t have any intention to cause any trouble for anyone but in order to ensure that the LEP programme does not suffer from failure due to gross negligence, we had to take legal recourse against him as the ultimate alternative and we will continue to do so again if any entrepreneur behaves in the manner Tandin did.” He added “despite the time and effort we wasted pursuing Tandin, it is still our heartfelt wish to support him and help him grow”.
The co-ordinator of the Loden Foundation, Dorji Tashi said:, “Tandin has now successfully paid back the loan” and added that repayment is crucial as the money is recycled to help new entrepreneurs. Although the court allowed Loden to confiscate his musical equipments, Loden decided not to do so, as it is genuinely committed to help Tandin realize his artistic creation and become a successful entrepreneur.
Loden follows a zero tolerance policy for any entrepreneur who fails to pay back the loan or take their business forward due to negligence and carelessness. If the failure of repayment is due to unavoidable circumstances Loden is more lenient and supportive.