labels: Agriculture
Rangarajan panel wants bank branches to cover 250 new farmers a year news
04 March 2008

The committee on financial inclusion headed by former RBI governor C Rangarajan has recommended that the semi-urban and rural branches of commercial banks and regional rural banks set for themselves a minimum target of covering 250 new cultivator and non-cultivator households per branch per annum, with an emphasis on financing marginal farmers and poor non-cultivator households for achieving financial inclusion.

The committee submitted its final report to the finance ministry on 4 January 2008. Meanwhile, based on the recommendations for the interim report of this committee, the government has decided to constitute the financial inclusion fund (FIF) for meeting the cost of promotional and developmental intervention, with a corpus of Rs500 crore.

In addition the centre has also accepted the panel's recommendation for a financial inclusion technology fund (FITF), also with a Rs500-crore corpus, to meet the cost of technology adoption.

The initial funding for the two funds will come from the centre, Reserve Bank of India (RBI) and National Bank for Agriculture and Rural Development (NABARD).

As a part of the financial inclusion to provide institutional credit to the poorer sections of the rural community, NABARD has will coordinate with sponsor banks and regional rural banks (RRBs) to extend their coverage to uncovered districts through branch expansion and establishment of new RRBs wherever feasible.

During the current year 39 new districts have been covered by RRBs taking the total to 573 districts. Further, licenses have been granted by the Reserve Bank of India for opening 321 branches in the covered / uncovered districts in the current financial year.


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Rangarajan panel wants bank branches to cover 250 new farmers a year