Banks achieve 100% financial inclusion in state

6,024 villages with a population below 2,000 persons have been identified as unbanked, allotted to banks for opening outlets

Commercial banks in Karnataka have achieved 100 per cent financial inclusion ahead of the March 2012 deadline set by the Reserve Bank of India (RBI). The banks have set up banking outlets in all the identified 3,395 unbanked villages of over 2,000 population.

Announcing this at the 120th State Level Bankers’ Committee (SLBC) meeting, here on Monday, Basant Seth, chairman, SLBC said the first phase of financial inclusion has been completed with the coverage of villages with a population of over 2,000 persons. “It is expected that the banks will be able to provide basic banking services like savings-cum-overdraft accounts, simple savings product like recurring deposit, credit products like General Credit Card and Kisan Credit Cards and remittance through these outlets,” Seth said.

For villages with population below 2,000, and as many as 6,024 villages have been identified as unbanked and allotted to Banks for opening banking outlets. The lead district managers (LDMs) have been advised to re-map the villages on gram panchayat (GP) basis, place it before BLBCôDCC and then forward the list to SLBC so as to allot one GP to one BC to improve the viability and sustainability of BC.

In terms of Government of India guidelines the LDMs have submitted District Service Area Plans under Financial Inclusion to District Administration for hosting in the district website. All the districts have hosted the same, except Ramanagar district, a newly carved-out district, which does not have district website and in Udupi where the infrastructure is yet to be ready on account of shifting of the DC’s Office to Manipal, Seth, who is also chairman and managing director of Syndicate Bank said.

The RBI has identified Bidar, Chamarajanagar, Gulbarga, Bangalore Rural, Koppal and Raichur as underbanked districts. Some 24 villages with population of 5,000 and above but without brick and mortar branches have been identified and communicated to the concerned service area banks for opening of the branches, he said.

“Of these, branches in two villages have been opened and I request the concerned banks to open branches in the remaining villages before March 2012. Further, the category of villages of population of 10,000 and above population, one village in Bellary district has been identified and allotted to SBM, service area bank for opening a branch before March 2012,” Seth said.

Wherever full-fledged branches are not found to be viable, ultra-small branches can also be opened wherein premises with an area of 100-200 sq ft to be obtained from gram panchayat office/other government building free of rent with the BC functioning regularly and a designated officer with laptop, visiting once/twice in a week to provide customer-related services effectively, he noted.

The governor of the RBI, during the review meeting with the CMDs / top management of banks at Bangalore on January 30, 2012, had advised that a minimum of 15 per cent unbanked villages should be covered by brick and mortar branches and credit linkage should be raised from the present level of around 45 per cent to 50 per cent by July 31, 2012.