Survey reveals district banking slippage

The district administration and the banking community in Hooghly district of West Bengal had claimed that they achieved 100 per cent financial inclusion but the claim had turned out to be false on scrutiny. 

Earlier this year, the district was declared 100 per cent financially included, but a subsequent study commissioned by the Reserve Bank of India (RBI) revealed that banking facilities are yet to reach each and every household of the district. 

The study, conducted by Jadavpur University, and commissioned by the RBI, found that only two-third's of the total number of families of the district have proper banking facilities. 

"The progress of financial inclusion has slow, though steady, compared to other states in West Bengal," admitted a senior official of RBI, who wished not to be named. He admitted, the study showed that the financial inclusion was only partial.

A district is said to have achieved total financial inclusion, if each family in the district have bank account, and have access to facilities like credit, insurance and other financial products. 

The state has set a revised target to achieving total financial inclusion in Hooghly by March 2009. In addition, it has set a target of achieving up to 80 per cent financial inclusion in about eight districts of the state by 2009. By 2012, the the government aims to have total financial inclusion in all the 18 districts the of the state. 

It is to be noted, in West Bengal the concept of door-to-door is in a nascent stage, which makes the task of financial inclusion more difficult. 

According to Mathew Titus, executive director, Sa-Dhan, an association of community development finance institutions, rural people prefer money lenders to banks, even with higher interest rates, because of add-on facilities which they offer. 

In this regard, State Bank of India, has appointed 274 business facilitators and eight business correspondents to offer banking facilities in rural areas. To monitor their functions, the bank has appointed retired bank officers. 

These facilitators and correspondents report to a central processing cell, rather than to branch offices. Recently, SBI has also signed a memorandum of understanding (MoU) with the Damodar Valley Corporation (DVC), for providing credit to self help groups. RBI has also stepped up efforts for financial inclusion, by emulating the business correspondent model in the state, participating in village-level fairs and inviting bankers in them.