Financial inclusion, the process of ensuring access to timely and adequate credit by the vulnerable groups at affordable cost, is likely to be completed in 11 more districts of the state by the end of December 2009.
These districts are Koraput, Kalahandi, Kandhamal, Nuapada, Baragarh, Jharsuguda, Jagatsinghpur, Bhadrakh, Dhenkanal, Gajapati and Mayurbhanj.
Nine districts namely Cuttack, Ganjam, Puri, Raygada, Nayagarh, Keonjhar, Kendarapara, Angul and Balsore have already been declared as financially included. Though the process was targeted to be completed by October 2008, due to various factors it couldn’t be completed in time. The issue figured in the deliberations of the State Level Bankers’ Committe (SLBC) meeting held here on Tuesday.
Speaking on the occasion, Brij Mohan Mittal, executive director, Uco Bank and Chairman SLBC said, merely opening of no frill accounts of the households will not serve the purpose. All accounts should be credit linked either with the issuance of the General Credit Card (GCC) or any other credit for taking up economic activities to support their livelihood for inclusive growth.
"New and creative approaches are needed to convert poverty into an opportunity for all concerned. So the focus needs to be on micro-saving, micro-credit, micro-remittance and micro-finance’, Mittal said.
Admitting that the pace of financial inclusion in the identified districts is not satisfactory, he said, the process must be completed by the end of 2009 as committed by SLBC earlier.
The achievement of financial inclusion targets in different district are Koraput (78.64 percent), Kandhamal (97.75 percent), Kalahandi (89.95 percent), Nuapada (88 percent), Baragarh (40.31 percent), Jharsuguda (73.01 percent), Dhenkanal (93 percent) and Gajapati (90 percent) by 31st March, 2009. Among other districts, Jagatsinghpur was able to achieve 84.81 percent target, Bhadrakh 93.29 percent, and Mayurbhanj 42.43 percent by the end of December, 2008.
Expressing his concern over the poor recovery of loans by the banks in Orissa, Mittal said, the recovery rate was only 46.11percent by the end of December 2008.
Since there is no improvement in recovery, the bankers should seek assistance from the government agencies to boost recovery, he added.
Finance minister Prafulla Chandra Ghadai urged the banks to improve credit flow to the micro, small and medium enterprises (MSME), textile , handloom, agriculture sector. Besides, they should set up training centres for unemployed youths.
Finance secretary R N Senapati said, the credit-deposit (C-D) ratio of the banks operating in Orissa declined to 68.8 percent from 76.9 percent a year back. Though the deposits have been increasing at a higher rate, there is no commensurate increase in the advances.
S Sethi, deputy general manager (DGM), Reserve Bank of India said, in line with the neighbouring Andhra Pradesh government, the possibility of the electronic payments transfer system for the beneficiaries of the social security schemes may be explored in Orissa. The system of Lok Adalats may also be adopted to expedite the rate of recovery, Sethi added.
The chief general manager (CGM) of the State Bank of India (SBI) M N Rao, General Manager, Uco Bank S M Sinha, C R Patnaik, CGM, Nabard were present.
