The state level bankers’ committee (SLBC) has held regional rural banks (RRBs) responsible for the slow pace of growth in achieving financial inclusion in Karnataka. The commercial banks, which have RRBs under their fold, should handhold them and monitor their performance closely so that the job of financial inclusion is completed by March 2012 as directed by the Reserve Bank of India (RBI), an SLBC official said.
“Though the performance of commercial banks by and large has been satisfactory, there is a need to quicken the pace so that the remaining 1,682 villages are covered by March 2012. I find that some of the RRBs have a large gap to be filled and I request the sponsor banks to actively hand hold them and monitor their performance closely,” Basant Seth, chairman and managing director, Syndicate Bank and chairman of SLBC, said.
Delivering his key-note address at the 118th quarterly meeting of SLBC, here on Wednesday, he said out of 3,395 unbanked villages with population of over 2,000 in the state, 1,713 villages have been covered till June 2011, which is about 52 per cent of the target. He said the government proposes to route all the benefits under its social security and subsidy schemes through electronic benefit transfer (EBT) scheme.
“In order to make the programme successful, the government desires us to extend banking services in all the villages in a systematic way under a structured financial inclusion plan. As advised by Indian Banks Association, 6,029 villages have been identified as unbanked in the 1,000-2,000 population group and these villages have been allocated to the banks through lead district managers for providing banking services,” he said.
Seth advised all the banks to follow the operational guidelines issued by RBI on implementation of EBT scheme and its convergence with financial inclusion.
Speaking on implementation of annual credit plan, the chairman said that banks have disbursed Rs 11,543 crore under priority sector credit during the first quarter ended June 2011 against annual projection of Rs 41,355 crore for the current fiscal, achieving 28 per cent of the annual target.
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Under agriculture sector, banks have disbursed Rs 7,644 crore during the first quarter ended June 2011. The target under agriculture credit has been revised upward to Rs 31,380 crore in tune with national priority. Under secondary and tertiary sectors, disbursement was to the tune of Rs 2,003 crore and Rs 1,896 crore respectively.
As per the directions of finance ministry, rapid action plan has been prepared and strategies devised to provide agri-credit limit to all the farmers by September 30, 2011 by conducting two meetings, he said.
Seth also requested the state government to direct all field-level functionaries to identify uncovered farmers through adequate publicity. He also asked banks to provide longer repayment period to small and micro enterprises, housing loans, vehicle loans, so that EMI does not increase, in the light of economic uncertainty and hike in interest rates, which will weather the current economic stress.