There are about 600,000 villages but only 32,919 rural bank branches in the country : Finance Minister

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Ratnam Chandra,,

INVC,,

Delhi,,

The Union Finance Minister Shri Pranab Mukherjee said that one of the biggest challenges before our nation today is to ensure inclusive growth. The Finance Minister said that financial Inclusion is an important priority of the Government as only 38% (32,919) of the 87,051 bank branches of Scheduled Commercial Banks are in rural areas and only 40% (approx.) of the country’s population has bank accounts. The Finance Minister was speaking on the occasion of 106th Foundation Day Celebrations of Corporation Bank here today.

The Union Finance Minister Shri Pranab Mukherjee said while there are about 600,000 villages in India as per the 2001 Census but there are only 32,919 rural bank branches in the country. The Finance Minister said to address this need, he had in 2010-11 directed all banks to provide appropriate banking facilities to habitations having population in excess of 2000 by March, 2012 using various models and latest technologies including branchless banking through Business Correspondents (BCs).

 

The Union Finance Minister Shri Pranab Mukherjee said that the banks through the forum of State Level Banker Committees (SLBCs) have formulated their road maps for Financial Inclusion and have identified approximately 73,000 habitations having a population of over 2000 for providing banking facilities. He said that these habitations have been allocated to Commercial Banks, Regional Rural Banks and Cooperatives Banks for providing banking facilities in a time bound manner. The Union Finance Minister said that this would provide new bank accounts to around 5 crore rural households. He said that this Financial Inclusion Campaign named “Swabhimaan” aims at providing branchless banking through the use of technology. Shri Mukherjee said that Banks will provide basic services like deposits, withdrawals and remittances using the services of Business Correspondents also known as Bank Saathi. The Finance Minister said that this initiative also enables Government subsidies and social security benefits to now be directly credited to the accounts of the beneficiaries and who would be able to draw the money through the Business Correspondents in their village itself.

 

The Union Finance Minister Shri Pranab Mukherjee said  Indian economy has to grow at a double digit rate in which Indian banks will have to play a facilitator and pro-active role. He said that the turf is going to be highly competitive. He said that the demands of this rapidly growing economy too are going to be very aggressive. Shri Mukherjee said one such critical area for lending remains the agricultural arena.  He said that it is heartening to note that the banks have extended the increased credit to this important sector over the years.

The Union Finance Minister Shri Pranab Mukherjee said that the Government of India had, in 2004, announced a package for doubling the flow of credit to agriculture and allied activities in a period of three years commencing from 2004-05 over the amount disbursed during the year 2003-04. The Finance Minister said that the target was however achieved in two years and has been achieved each year thereafter, by the banking system. He said that the target for the flow of agriculture credit was set at Rs.3,25,000 crore for the year 2009-10, while the Banking system actually provided Rs.3,84,514 crore as credit. For the year 2010-11, the target was fixed at Rs.3, 75,000 crore, against which the Banking system has already provided Rs.2, 91,142 crore as credit as on 31st December, 2010, the Minister added. The Finance Minister Shri Mukherjee said the target of credit flow to the farmers has been raised to Rs.4,75,000 crore in 2011-12.  Banks have been asked to step up direct lending for agriculture and credit to small and marginal farmers, he added.

The Union Finance Minister Shri Pranab Mukherjee said since 2006-07, Government of India is also providing Interest Subvention to all Public Sector Banks(PSBs), Regional Rural Banks(RRBs) and Cooperative Banks for short term crop loans upto Rs 3 lakh, so as to ensure that short term agriculture credit is available at 7% p.a. to farmers. In 2010-11, an additional 2% interest subvention is being provided to those farmers, who repay their short term crop loans in time, the Finance Minister added. Thus, the short term crop credit is available to farmers @ 5% p.a. in 2010-11.  The Finance Minister Shri Mukherjee said in the year 2011-12, the Interest Subvention Scheme proposes to further incentivize prompt repayment by farmers by providing a further incentive of 3% intense interest subvention, i.e., loans will be available to farmers who pay on time @ 4% p.a.

The Union Finance Minister said that he is happy to note that to include the financially excluded rural populace to the main stream banking, the Corporation Bank has launched the Branchless Banking project using the cost effective ICT technologies and engaging the services of Business correspondents. Shri Mukherjee said that the rural people would thus be empowered to have access to banking services without having to spend their time to visit a branch to transact banking business. He said that the Bank has opened 1700+ Corp Grameen Vikas Kendras in the country. On this auspicious occasion of 106th Foundation Day of the Corporation Bank, the Union Finance Minister Shri Pranab Mukherjee announced the  inauguration of the Bank’s  Heritage and Financial Research Centre at Udupi  which will house, Numismatic Museum, Notophily Museum  and an exclusive section dedicated to contribution of past and present luminaries in the field of Indian Banking and Finance.

2 COMMENTS

  1. Yes Mr.FM this is your concern “There are about 600000 villages but only 32919 rural bank branches”,but are you aware with this fact that RRB workers those are serving in rural area getting least perks in compare to their counterpart PSU bank workers,they are serving on same post almost 20 years.This is the situation,what more you expect from them?

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