The National Bank for Agriculture and Rurual Development (NABARD) will pay greater focus on financing through 'Joint Liability Groups' (JLs) in Kerala as it is found more effective way of priority sector lending.
JLs are informal groups of even 4-10 individuals joining together for the purpose of availing bank loans through group mechanisms against mutual guarantee.
According to NABARD's State Credit Plan 2011-12, financial inclusion through JLGs would be deepened in partnerships with neighbourhood groups like 'Kudumbasree', NGOSs and Banks.
Over 21,000 JLGs had been promoted by the bank in the last year in Kerala alone. It also gives promotional assitance for formation and nurturing of JLGs by banks and NGOs, sources said.
Through JLGs, the bank could "reach the rural masses including the tribals, fisherfolk and farmers in a better way," a NABARD document quoting Dr Prakash Bakshi,executive director, said.
NABARD's 'State Credit Plan' for 2011-12, an aggregation of potential linked credit plans of the 14 districts of Kerala, envisaged a outlay of Rs 58,159 crore.
While the 'primary sector' comprising agriculture and allied activities would get Rs 25872 crore, the 'secondary sector' with small and micro enterprises would get a credit share of Rs 4130 crore.
The 'tertiary sector' including small road transport, tourism, housing and eductional loans would get an outlay of Rs 28,155 crore under the Credit Plan.
To help farmers meet growing expenses, the bank would ensure 100 per cent coverage of Kisan Credit Cards (KCC) to all eligibele farmers in the state. Efforts will also be done to make KCCs smart and linking to ATMs, it says.
The plan has laid focus on adequate credit estimate for crop production, organic farming, land development, soil and water conservation, rural tourism and traditional industries like coir, handlooms and handicrafts.
NABARD's annual financial assistance to Kerala for various economic activities in rural sector and rural infrastrure creation is in tune of over Rs 2,100 crore.
While it had provided an assistance of Rs 913 crore to banks for agriculture lending and non-farming activities, Rs 837 crore was outlayed under short term credit during 2009-10.
For creation of rural infrastrure, loans to the tune of Rs 382 crore was provided to Government of Kerala during the same period, sources said.
