Fresh lending to agri, MSME sectors improves in Gujarat

SLBC says over 1.4 million accounts opened under PMJDY

Besides opening 1.4 million accounts under the much talked about Pradhan Mantri Jan Dhan Yogjana (PMJDY), the Gujarat banks have fared well in providing fresh lending to agriculture and MSME (micro, small and medium enterprises) sectors during the first quarter of 2014-15. However, advances to weaker and agriculture sectors was a concern as it remained below the target along with housing and education loans.

The State Level Bankers’ Committee (SLBC) which met today informed that 14,18,432 accounts have been opened under PMJDY in all the banks in Gujarat till September 23. Ashwani Kumar, chairman & managing director Dena Bank and Gujarat SLBC chairman said that out of the 12.2 million households in the state 9.3 million have been covered under banking services.

“As on date we have opened over 1.4 million accounts under PMJDY covering 0.8 million households in Gujarat. With this 9.3 million households are now covered under banking services,” Kumar said.

“With this rate we think covering the remaining 2.8 million before January 26, 2015 (deadline as set by Prime Minister Narendra Modi) will not be problem,” said Kumar while talking to mediapersons after attending the SLBC meeting in Ahmedabad.

He informed that banks in Gujarat have been given annual target of Rs 76,627 crore under Service Area Credit Plan (SACP), of which for quarter ended June 30 fresh lending was Rs 25,482 crore which comes to 33.25 per cent achievement in first quarter itself.  “This is a good sign with over 33 per cent target achieved in first quarter itself. Usually this is not the case in first quarter of a financial year,” Kumar explained.

In agriculture segment, under SACP, against the target of Rs 49,889 crore disbursement has been Rs 18,604 crore for various agriculture activities for quarter ended June 30, 2014. Even in MSME sector disbursement have been done to the tune of Rs 4,448 crore in first quarter against target of Rs 12,064 crore for the entire year. This comes to 36.87 per cent of the target for the MSME sector.

Kumar expressed concern over the fresh lending under SACP for housing and educational loans with was below target. “The growth was not good in the housing and educational loan segment we have asked the banks to gear up on them,” he said.

As far as advances to priority sector was concerned the SLBC has asked the member banks to explore all possibilities to extend finance under all parameters of priority sector advances to achieve stipulated benchmark.

Though there was absolute growth of Rs 7,253 crore and Rs 1,920 crore over March 2014 in case of advances to agriculture and weaker sections respectively, target for these sectors could not be reached. The benchmark for advances to agriculture was set at 18 per cent and weaker sections 10 per cent of the total advances. Against this, achievement in the first quarter of 2014-15 was 14 per cent and 6 per cent for agriculture and weaker section respectively.