'Lend more to the poor'

BANKER'S CONFERENCE 2006

Union finance minister P Chidambaram has urged domestic banks to increase lending to the poor and play a pivotal role in reaching out to the larger sections of the country.

In his address at the valedictory function of Vijaya Bank's platinum jubilee celebrations, Chidambaram emphasised the need for achieving the national growth rates set by the government.

"Poor are good savers and borrowers. About 48 per cent of all households, 51 per cent of farm households and 78 per cent rural non-farm households do not have access to banking service. There is a long way to go for our banks," he said.

"We must recognise what we are here for, who are we serving. The demand of our time is we must reach credit and finance to women, students, self employed and small entrepreneurs. They all deserve equal respect and equal treatment from all institutions including banks," he said.

Chidambaram said large cross-sections of the society such as farmers, planters, women, teachers and ex-servicemen need to be addressed by the banks. "They are vital pillars of our society," he said.

"If India wants to become the third largest economy in the world in the next few years, the banking sector has to play a greater role by extending credit to weaker sections of the society," he said.

Stating that still 50 per cent of the population is still to get any banking assistance in the country, the finance minister urged the banks to find out ways and means to extend finance to this 50 per cent of the population and come out with new areas of finance.

Karnataka chief minister H D Kumaraswamy also urged the government to increase focus on micro finance and increase lending to the agriculture sector.