Aug 22, 2024 08:44 PM IST
The FM urged the bank officials to collaborate effectively and leverage government schemes to deliver greater benefits to the common people, reinforcing the commitment to expanding banking services and contributing to the country’s progress
Jaipur: Union finance minister Nirmala Sitharaman has asked the officials of Regional Rural Banks (RRBs) to enhance their local networks in order to support India’s development goals.
The FM was addressing a review meeting in Udaipur on Thursday with the chairman of RRBs of the west-central region and chief executive officers.
She urged the bank officials to collaborate effectively and leverage government schemes to deliver greater benefits to the common people, reinforcing the commitment to expanding banking services and contributing to the country’s progress.
“To increase banking reach, the officials of RRBs should strengthen their local contacts to fulfill the resolution of developed India,” said Sitharaman.
In the meeting, discussions were focused on developing effective action plans to address the challenges facing the banking sector. Additionally, the annual action plan and the progress of the banks for the last financial year were reviewed.
Sitharaman noted the natural potential of the Prime Minister Surya Ghar scheme in the states of Gujarat and Rajasthan and urged the RRBs to generate awareness and provide credit under the scheme.
The potential of the ‘one district, one product’ (ODOP) program was also highlighted to increase credit penetration by RRBs.
Similarly, RRBs were directed to identify potential trades under the PM Vishwakarma scheme in their areas of operation to provide credit. Additionally, RRBs were instructed to increase their share in ground-level agriculture credit disbursement and achieve the objectives of priority sector lending.
The FM acknowledged the satisfactory improvement in the technology upgrade of the nine RRBs in the west central region since regular reviews were initiated in 2022.
According to the data from the RRBs, the consolidated capital to risk-weighted assets ratio (CRAR) increased from 7.8% in FY 2021 to 13.7% in FY 2024. It said that the profit margin was also improved, with losses of Rs.41 crore in FY 2021 turning into a net profit of Rs.2,018 crore in FY 2024. Additionally, gross non-performing assets (GNPA) remain relatively low, with a ratio of 3.9%.
The FM urged these RRBs to continue this positive momentum in the future and directed them to leverage their healthy CASA ratio to distribute more credit.
She also called for an intervention from the Reserve Bank of India to resolve pending dues to RRBs from state governments, in addition to the efforts by the government and sponsored banks.
