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CM asks banks to step up rural credit

By Staff reporter

GUWAHATI, June 14 � Chief Minister Tarun Gogoi today said, �Financial institutions and banks must play a proactive role in rural credit flow.� He was addressing a meeting convened by the Union Finance Minister with the Chief Ministers of east zone at Patna on the performance of the banking sector. Understaffing of the rural bank branches, coupled with short-tenure officer posting are also the factors of low level rural credit flow, he pointed out, said an official press release here.

Gogoi said, most of the states� small and marginal farmers could not avail loans as landholding certificates are being insisted upon.

He called for implementing the recommendations of Reserve Bank of India (RBI) for revitalizing the lead bank scheme immediately.

Pointing out the fact that only three khariff crops and five rabi crops in Assam are presently covered under the national agriculture insurance scheme, Gogoi said, � the notified area of coverage may be brought down to the gram panchayat level because blocks and revenues circles are too large for proper assessment of yield loss. Moreover, the claim disposal procedures under the scheme also need to be simplified.�

He regretted that the credit flow to small scale industries and micro enterprises has not been encouraging. In this context, he requested the Union Finance Minister to launch a special drive for three-fold increase in credit disbursement in the State.

He requested the banks to adopt a liberal attitude in funding rural housing. The Chief Minster also called for more lending to weaker sections and minority communities in Assam. �The untapped potential of this segment of our population must be realized through imaginative schemes and interventions,� he asserted.

He also laid stress on expansion of banking network in the State. �Though the number of bank branches in Assam increased to 1517 with the addition of 89 new branches in 2009, 28 districts are grossly underbanked. The bank�population ratio in the State is still high at 17600 as compared to the national average of 12500,� he pointed out.

Gogoi said that though the high level committee set up by the RBI to prepare a financial sector plan for the NE region found that the banks would have to open about 90 new deposit accounts per month per branch in the region to reach the national average of 59 per cent, it still remains a far cry.

He regretted that though the self-help group movement was gaining momentum in the State, only 1.56 lakh of them, out of the 2.20 lakh, have been credit-linked. He called upon the Union Finance Minister to constitute a high level committee for evolving a system for ensuring bank credit to the SHGs at lower, affordable and reasonable rates with special focus on women groups.

Gogoi also pleaded with the Union Finance Minister to issue clear directives to banks to adopt a uniform policy applicable to all states so far as payment and rate of service charge to banks for handling NREGA payments are concerned. �Similar uniform policy may be adopted in respect of other such central and state programmes also,� he pointed out.

Pointing out the imperative need for long-term credit to farmers, Gogoi requested the Union Finance Minister to implement the scheme for revival of the long-term co-operative credit structure in Assam as soon as possible.

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CM asks banks to step up rural credit

GUWAHATI, June 14 � Chief Minister Tarun Gogoi today said, �Financial institutions and banks must play a proactive role in rural credit flow.� He was addressing a meeting convened by the Union Finance Minister with the Chief Ministers of east zone at Patna on the performance of the banking sector. Understaffing of the rural bank branches, coupled with short-tenure officer posting are also the factors of low level rural credit flow, he pointed out, said an official press release here.

Gogoi said, most of the states� small and marginal farmers could not avail loans as landholding certificates are being insisted upon.

He called for implementing the recommendations of Reserve Bank of India (RBI) for revitalizing the lead bank scheme immediately.

Pointing out the fact that only three khariff crops and five rabi crops in Assam are presently covered under the national agriculture insurance scheme, Gogoi said, � the notified area of coverage may be brought down to the gram panchayat level because blocks and revenues circles are too large for proper assessment of yield loss. Moreover, the claim disposal procedures under the scheme also need to be simplified.�

He regretted that the credit flow to small scale industries and micro enterprises has not been encouraging. In this context, he requested the Union Finance Minister to launch a special drive for three-fold increase in credit disbursement in the State.

He requested the banks to adopt a liberal attitude in funding rural housing. The Chief Minster also called for more lending to weaker sections and minority communities in Assam. �The untapped potential of this segment of our population must be realized through imaginative schemes and interventions,� he asserted.

He also laid stress on expansion of banking network in the State. �Though the number of bank branches in Assam increased to 1517 with the addition of 89 new branches in 2009, 28 districts are grossly underbanked. The bank�population ratio in the State is still high at 17600 as compared to the national average of 12500,� he pointed out.

Gogoi said that though the high level committee set up by the RBI to prepare a financial sector plan for the NE region found that the banks would have to open about 90 new deposit accounts per month per branch in the region to reach the national average of 59 per cent, it still remains a far cry.

He regretted that though the self-help group movement was gaining momentum in the State, only 1.56 lakh of them, out of the 2.20 lakh, have been credit-linked. He called upon the Union Finance Minister to constitute a high level committee for evolving a system for ensuring bank credit to the SHGs at lower, affordable and reasonable rates with special focus on women groups.

Gogoi also pleaded with the Union Finance Minister to issue clear directives to banks to adopt a uniform policy applicable to all states so far as payment and rate of service charge to banks for handling NREGA payments are concerned. �Similar uniform policy may be adopted in respect of other such central and state programmes also,� he pointed out.

Pointing out the imperative need for long-term credit to farmers, Gogoi requested the Union Finance Minister to implement the scheme for revival of the long-term co-operative credit structure in Assam as soon as possible.