BoI links up with NGO for rural financing

Bank of India (BoI) has entered in a collaboration with ACIL-Navasarjan Rural Development Foundation (ANARDE), a non-government organisation (NGO) to increase rural penetration and boost lending to the agriculture sector.

A pilot project on an integrated approach to agriculture lending was kick-started in Dabhan near here on Monday.

BoI aims to enter into more tie ups in other states depending upon the response from the pilot project in Gujarat.

The tie up between BoI and ANARDE will cover 18 districts of the state, covering about 240 villages. BoI will use the network of the NGO to provide agriculture and rural finance.

"We have initiated the project in Gujarat in view of its prominence in our network. The tie up with an NGO would benefit us in terms of their network as well as their expertise. We would go ahead with the similar experiment in other states too depending upon the response to our first tie up," said M Balachandran, executive director, BoI.

The bank aims to disburse about Rs 240 crore through the collaboration within a year under its annual credit plan.

The farmers can avail loans for any agriculture or related activities.

"Through the tie-up, BoI aims at utilising expertise and network of ANARDE in rural areas to make its services available. The tie up, probably first of its kind in country, will also enable the bank to reach to the right people resulting in better utility of funds. The bank will also make sure to help the projects initiated by ANARDE in the field of adult education and creating self help group," said Ramavatar Singh, AGM, priority sector, BoI.

Commenting on the achievements in the field of rural finance by banks, the government nominee director in BoI, Amitabh Verma, said: "By the end of November, the aggregate disbursement by banks to the rural sector is Rs 65,000 crore against Rs 1,05,000 crore, target for the current fiscal. The target is achievable through innovative ways such as involving not for profit organizations that have better understanding of the rural market."