Finance minister Pranab Mukherjee will meet heads of public sector banks (PSBs) and financial institutions tomorrow to review their annual performance.
Mukherjee would assess the flow of credit to agriculture, micro, small and medium enterprises (MSMEs), housing and education sectors, the finance ministry said in a statement today.
He will review their performance with regard to deposits, advances, gross non-performing assets and net profit.
Issues like infrastructure lending, implementation of interest subsidy schemes for housing the urban poor and lending to minority communities will also come up for discussion.
Another issue high on the agenda is the performance of banks in the field of financial inclusion as well as their financial inclusion plan for 2011-12. Nandan Nilekani, chairman of the Unique Identification Authority of India, will also make a presentation on ‘financial inclusion and e-payments’.
A total of 72,950 villages were identified for providing appropriate banking facilities and bringing them into the overall banking network. Of these, 29,569 villages were covered in 2010-11 and the rest, 43,381 villages, are to be covered during this financial year. These include 23,023 villages to be covered by PSBs, 18,760 villages by regional rural banks, 1,386 villages by private banks and 212 villages by cooperative banks.
At present, there are 71 unbanked blocks. Of these, 70 blocks are in the northeastern region while one is in Jammu and Kashmir.
Agriculture lending will be another area of discussion. The government has set a target of Rs 475,000 crore for agriculture credit in 2011-12, against Rs 375,000 crore in the previous year. The credit disbursed in 2010-11 was of Rs 446,778 crore, 19 per cent more than the target.
As far as credit flow to MSMEs is concerned, it has increased over the years. However, subsequent to the review meeting in April, the Small Industries Development Bank of India was directed to draw up an action plan to ensure effective implementation of the scheme.
Banks were mandated to achieve a 10 per cent annual growth in the MSME account and 20 per cent growth in the credit to the sector.
For educational loans, the Indian Bankers’ Association had prepared a model scheme in 2001. It was circulated to banks for implementation by the Reserve Bank of India in April 2001. The total outstanding loans of PSBs for education as on March 31 stood at Rs 43,074 crore in 2,235,532 accounts.
