General credit card loans to be part of priority sector

MONETARY POLICY 2008-09/ POLICY AND THE INDIVIDUAL

At present, 50 per cent of the credit outstanding under GCC is allowed to be classified as indirect finance to agriculture under the priority sector. The guidelines have been eased with the objective of bringing a larger population into the banking mainstream.

In the recent past, the central bank has been focusing on its agenda of financial inclusion. Accordingly, the RBI has been giving bank branch licences in unbanked centres. So far, 277 districts have been identified for 100 per cent financial inclusion and the target has been achieved in 134 districts in 18 States and five Union Territories.

All districts of Haryana, Himachal Pradesh, Karnataka, Kerala, Uttarakhand, Puducherry, Daman and Diu, Dadra and Nagar Haveli and Lakshadweep have achieved 100 per cent financial inclusion.

RBI governor, Y V Reddy in a meeting with bankers has expressed his satisfication with the progress made so far. However, he emphasised that banks will have to acheive financial inclusion, especially with saving accounts.