 "Rising NPA level worries bankers in Odisha")
The rising nonperforming assets (NPAs) of the banks in Odisha have emerged as a major concern for the banking fraternity and the state government.
The NPAs have mounted to Rs 6,951.38 crore, about 8.26 per cent of the total outstanding advances of Rs 84,156.97 crore, as on June 30. The sector-wise agriculture term loans top the list with NPAs of 17.49 per cent, followed by short term crop loan at 13.28 per cent. Similarly, in agriculture allied sector, 9.32 per cent loans have turned bad.
Among other priority sectors, NPA for MSMEs (micro small and medium enterprises) stands at 8.80 percent while it is 10.43 per cent and 6.31 per cent respectively for education and housing loans.
NPA rates for PMRY/PMEGP, SHG, SJSRY and WCC are 29.84 per cent, 21.21 per cent, 40.55 per cent and 20.98 per cent respectively.
Speaking at the 136th SLBC meeting, Chief Secretary Gokul Cahndra Pati has suggested constitution of a sub-committee of SLBC to look into the reasons for prevailing high rate of NPA among SHGs and projects in primary sector. The committee will come out with proposals to reverse the trend within a month.
Under the Orissa Public Demands Recovery Act, 12,365, cases involving recovery of Rs 157.56 crore are pending for disposal in the certificate courts.
Bankers present at the meeting expressed concern on the upfront court fees charged under the act.
Under the act, when any public demand payable to any person other than the Collector is due, such person has to send to the certificate officer a written requisition. The requisition, signed and verified in the prescribed manner, will be chargeable with a fee of the amount which would be payable under the Court Fees Act of 1870 in respect of a plaint for the recovery of a sum of money equal to that stated as due in the requisition.
"The court fees charged under the act is upfront while the recovery is nil. In states like Madhya Pradesh, Uttar Pradesh, Rajasthan, the court fees are charged proportionately on the amount recovered and the law can be changed by amending the act," said Sajjan Kumar Dokania, circle head, Punjab National Bank.
U N Behera, additional chief secretary (finance), asked the SLBC to send a formal proposal to the state government for the required amendment of the act. At the meeting, a memorandum of understanding (MoU) was signed between the state government and SLBC, on behalf of the banks, for direct transfer of funds to the accounts of Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS).
It may be noted, state ST (Schedule Tribe) & SC (Schedule Caste) Development, Minorities & Backward Classes Welfare Department plans to open one million accounts of ST and SC students for direct transfer of scholarship money by September, this year.
Pati emphasised on the flow of credit to agriculture and allied sector, particularly to the fishery and animal resource development projects. "The banks have to come forward in a big way to make the state self-sufficient in fresh water fish production as Odisha has enough potential," said the chief secretary.
The NPAs have mounted to Rs 6,951.38 crore, about 8.26 per cent of the total outstanding advances of Rs 84,156.97 crore, as on June 30. The sector-wise agriculture term loans top the list with NPAs of 17.49 per cent, followed by short term crop loan at 13.28 per cent. Similarly, in agriculture allied sector, 9.32 per cent loans have turned bad.
Among other priority sectors, NPA for MSMEs (micro small and medium enterprises) stands at 8.80 percent while it is 10.43 per cent and 6.31 per cent respectively for education and housing loans.
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"For Prime Minister's Rozgar Yojana (PMRY), Prime Minister's Employment Generation Programme (PMEGP), Swarna Jayanti Shahari Rozgar Yojana (SJSRY), Self Help Groups (SHG), Weaver Credit Card(WCC), the recovery performance, the NPA and overdue percentage are too high, which can only be rated as unsatisfactory", said the latest report of the State Level Banker's Committee (SLBC).
NPA rates for PMRY/PMEGP, SHG, SJSRY and WCC are 29.84 per cent, 21.21 per cent, 40.55 per cent and 20.98 per cent respectively.
Speaking at the 136th SLBC meeting, Chief Secretary Gokul Cahndra Pati has suggested constitution of a sub-committee of SLBC to look into the reasons for prevailing high rate of NPA among SHGs and projects in primary sector. The committee will come out with proposals to reverse the trend within a month.
Under the Orissa Public Demands Recovery Act, 12,365, cases involving recovery of Rs 157.56 crore are pending for disposal in the certificate courts.
Bankers present at the meeting expressed concern on the upfront court fees charged under the act.
Under the act, when any public demand payable to any person other than the Collector is due, such person has to send to the certificate officer a written requisition. The requisition, signed and verified in the prescribed manner, will be chargeable with a fee of the amount which would be payable under the Court Fees Act of 1870 in respect of a plaint for the recovery of a sum of money equal to that stated as due in the requisition.
"The court fees charged under the act is upfront while the recovery is nil. In states like Madhya Pradesh, Uttar Pradesh, Rajasthan, the court fees are charged proportionately on the amount recovered and the law can be changed by amending the act," said Sajjan Kumar Dokania, circle head, Punjab National Bank.
U N Behera, additional chief secretary (finance), asked the SLBC to send a formal proposal to the state government for the required amendment of the act. At the meeting, a memorandum of understanding (MoU) was signed between the state government and SLBC, on behalf of the banks, for direct transfer of funds to the accounts of Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS).
It may be noted, state ST (Schedule Tribe) & SC (Schedule Caste) Development, Minorities & Backward Classes Welfare Department plans to open one million accounts of ST and SC students for direct transfer of scholarship money by September, this year.
Pati emphasised on the flow of credit to agriculture and allied sector, particularly to the fishery and animal resource development projects. "The banks have to come forward in a big way to make the state self-sufficient in fresh water fish production as Odisha has enough potential," said the chief secretary.