Union FInance Minister Nirmala Sitharaman in Bengalur today.
Bengaluru: Union Minister for Finance and Corporate Affairs Nirmala Sitharaman today directed the Regional Rural Banks (RRBs) to increase their share in ground-level agriculture credit disbursement with a special focus on allied agriculture activities like dairy, animal husbandry, and fisheries.
While chairing a meeting to review the performance of 10 Regional Rural Banks of the Southern Region, covering the 5 states of Andhra Pradesh, Karnataka, Kerala, Tamil Nadu and Telangana, and the Union Territory of Puducherry, she asked the RRBs to take necessary steps to realise the full potential of allied agriculture activities in the region.
Given the crucial role of RRBs in supporting the rural economy, the Union Finance Minister urged the Regional Rural Banks to increase credit disbursement under various Government of India flagship schemes such as MUDRA, PM Vishwakarma, etc, with the active support of their sponsor banks.
She specially directed RRBs and sponsor banks to work with respective state government departments to increase credit disbursement to the fisheries sector in Kerala, and the dairy sector in Telangana.
The meeting, with 10 RRBs present, focused on business performance, upgrading digital technology services, and fostering business growth in activities allied to agriculture and micro and small industries.
The Finance Minister acknowledged RRBs for the demonstrable improvement in their financial performance and technology upgradation ever since regular review was initiated in 2022. RRBs in the Southern Region have posted a consolidated profit of Rs 3,816 crore during FY 2024 which is more than 50% of the net consolidated profit of all RRBs combined. Sitharaman said the Consolidated Capital Adequacy Ratio (CRAR) of 17.6% and Gross Non-Performing Assets (GNPA) of 3.94% in FY 2024 were at healthy levels.
Sitharaman also noted the significant role played by RRBs in financial inclusion in Southern region and urged them to continue their efforts towards saturation under Financial Inclusion (FI) schemes of Pradhan Mantri Jan Dhan Yojana (PMJDY), Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY), Atal Pension Yojana (APY), etc. by achieving respective targets. The Finance Minister directed sponsor banks to rework the targets of FI schemes along with RRBs and further asked banks to launch a special drive to operationalise inoperative accounts under PMJDY.
During the review, the importance of enhancing the Current Account Savings Account (CASA) deposits was underlined, reinforcing the need for RRBs in the southern region to mobilise Current Account and Savings Account (CASA) deposits to further accelerate the pace of sustainable credit growth.
Specific emphasis was placed on reinforcing credit support to MSMEs and streamlining customer onboarding processes through digital innovations. The Finance Minister directed SIDBI and RRBs to collaborate on digital platforms, exploring co-lending/risk-sharing models and refinance for the MSME portfolio.
She stated that all RRBs should devise a strategy for MSME credit with customised products aligning with cluster activities and conduct special outreach programmes with convergence and awareness regarding the various Government of India schemes. She said that the RRBs should explore leveraging the digital platforms of SIDBI and seek MSME refinance from it.
Sitharaman appreciated that the 10 RRBs have completed various technology upgrades of customer-centric digital services such as micro-ATMs, call centres, net banking, Video KYC, RTGS, IMPS, etc. She urged RRBs to promote these services amongst their customers to increase their usage with the help of respective sponsor banks.
The Department of Financial Services (DFS) was directed by the Union Finance Minister to look at the recruitment rules for RRBs and examine them to amend them suitably to ensure knowledge and proficiency of the local language was present in the candidates.
The Finance Minister also urged State Governments to provide their views on the proposal of amalgamation of RRBs on the principle of ‘One State-One RRB’.
Union Minister of State for Finance Pankaj Chaudhary; Secretary, Department of Financial Services (DFS) M. Nagaraju; Executive Director, the Reserve Bank of Indi; Chairpersons of RRBs and sponsor banks; Additional Secretary, DFS, representatives of NABARD and SIDBI and other senior officers of participating states and UT were also present during the meeting.
– global bihari bureau
