INCLUSIVE GROWTH

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• INCLUSIVE GROWTH
• -Role of Banks as Credit provider in the
  Economy and Credit delivery models
• by
• Mr. Ganesh Pawar,
• Mr. Sushil Kumar, Mr. Joshi
• Mr. Deepak Chawla

2
Introduction

• Meaning Financial Inclusion is the delivery of
  banking services at affordable costs to vast
  sections of disadvantaged and low income groups
  including households, enterprises, SMEs,
  traders.

3
Indian Scenario

• Around 50 of the Indian population suffers from
  chronic poverty and hunger. Only 31 of the
  Indian population has accsess to Banking
  services. The rest 69 are still deprived of
  bare minimum banking services for which they are
  totally dependent on informal banking sources
  like private money lenders. While the need to
  solve this mammoth problem is great, we are
  unable to reach large numbers of the poor with
  products, services and information they need to
  achieve financial security.

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Aim

• Our national vision for 2020 is to open nearly
  600 million new customers' accounts and service
  them through a variety of channels by leveraging
  on IT. However, illiteracy and the low income
  savings and lack of bank branches in rural areas
  continue to be a road block to financial
  inclusion in many states. To achieve this
  objective commercial banks have started a drive
  to open branches in hitherto unbanked areas.

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Steps

• It can be said that Bank nationalization was
  first step towards Financial Inclusion in India.
• RRBs were created to take banking services to
  rural people.
• Public Sector banks are making use of the
  services of non-governmental organizations
  (NGOs/SHGs), micro-finance institutions and other
  civil society organizations as intermediaries for
  providing financial and banking services. These
  intermediaries are being used as business
  facilitators (BF) or business correspondents (BC)
  by commercial banks.

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• With a view to achieve complete Financial
  Inclusion our bank has introduced "no-frills"
  banking account viz PNB Mitra account. An
  overdraft facility of Rs 100 to 500 is available
  abinitio. PNB has also launched mobile ATMs to
  cover unbanked rural slum areas. General Credit
  Cards (GCC) are issued to the poor and the
  disadvantaged with a view to help them access
  easy credit.
• PNB has donated 1.81 crores for spastics,
  handicapped thru NGOs and charitable
  institution.Banks are also engaging services of
  Ex-servicemen as business facilitators.

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• Joint Liability Groups (JLGs) of the poor such as
  landless, share croppers and tenant farmers is
  another innovative mechanism towards ensuring
  greater financial inclusion. This mechanism has
  already been operationalised in a few regions
  under a Pilot Project of NABARD. Commercial Banks
  have been actively promoting such groups for
  effectively purveying credit and other facilities
  to such clients.

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• In the current budget the govt has earmarked a
  sum of Rs 100 Crores for Banks to open branches
  in un banked and difficult areas.
• Biometric card based authentication devices, are
  being used by the banks Business Correspondents
  at the villages.

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Achievements

• So far, 344 districts have been identified by
  State Level Bankers Committee for 100 per cent
  financial inclusion. As a result of the campaign
  of the public sector banks, 175 districts in 21
  States and 7 Union Territories have reported
  having achieved the target.

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• The self-help group (SHG)-bank linkage Programme
  has emerged as the major micro-finance Programme
  in the country and is being implemented by
  commercial banks, RRBs and co-operative banks. As
  on March 31, 2008 3.6 million SHGs had
  outstanding bank loans of Rs.17,000 Crore, an
  increase of 25 per cent over March 31, 2007 in
  respect of number of SHGs credit linked. During
  2007-08, banks financed 1.2 million SHGs for
  Rs.8,849 Crore. As at end-March 2008, SHGs had 5
  million savings accounts with banks forRs.3,785
  Crore.

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• The State Level Bankers Committee has set up 134
  Rural Self Employment Training Institute (RSETI)
  _at_ one in each district by 31.03.2008. These
  institutions are training at least one youth in a
  family below poverty line (BPL) in various fields
  and enhance capacity building.
• The debt waiver and debt relief scheme introduced
  in the last budget has been extended even this
  year as part of financial inclusion.

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Conclusion

• Credit has done more to enrich nations than all
  the gold mines in the world put together.
  Commercial banks act as spokes in the wheels for
  drive to achieve 100 financial inclusion in
  India. Financial inclusion through Commercial
  banks shall wipe out the last tear from the face
  of most deprived person on the Indian soil.

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• THANK YOU