Banks step up lending to SME sector

All banks in Karnataka have taken adequate steps to assist micro, small and medium enterprises in the state worst affected by the global economic downturn, George Joseph, chairman and managing director, Syndicate Bank, said.

Addressing the 107th meeting of the State Level Bankers’ Committee (SLBC) - Karnataka, in Bangalore, Joseph, who is also chairman of SLBC, said that timely initiatives have been taken by the government of India and RBI to create adequate liquidity in the market as well as address problems faced by the SME sector.

“Banks have stepped up assistance to the SME and housing sectors by way of providing additional finance, restructuring of loan accounts and reduction in interest rates,” Joseph said. All commercial banks, RRBs and co-operative credit institutions have implemented the Agricultural Debt Waiver and Debt Relief Scheme 2008 s per schedule, he added.

by displaying the list of eligible beneficiaries, Joseph said. The government has extended repayment time for the first installment by other farmers till March 31. It has also been decided to set up a Farmers Training Centre at Bagalkote by pooling resources from the lead banks and NABARD. The Karnataka government has allotted eight acres of land at Bagalkote for the same, Joseph said.

Joseph said that banks disbursed Rs 10,909 crore to the priority sector during the second quarter ended September 2008 against a total annual outlay of Rs 23,726 crore, reaching 46 per cent of their target for 2008-09. Under the primary sector, banks have disbursed Rs 6,763 crore, thereby attaining 46 per cent of the target during the year up to September 2008.

“The economic slowdown has not affected the performance of banks in priority sector lending. Though progress was comparatively poor till September 2008, it picked up and banks are sure of achieving their targets by the end of the current fiscal,” Joseph said.