Bangalore, Dec 11 (UNI) Union Minister of State for Finance Pawan Kumar Bansal today favoured a common strategy between the Union and state government to reduce interest rates on farm loans.
Speaking to newspersons Mr Bansal said now the Centre was bearing the cost of two per cent interest subsidy on farm loans. Many of the state governments were also offering interest subsidy to ensure low interest rate. This had to be rationalised, he said.
Mr Bansal, who was here to participate in the State Level Bankers meeting scheduled to be held tomorrow, said Karantaka had done well in implementing Prime Minister Manmohan Singh's call to achieve cent per cent financial inclusion.
The Minister said Karnataka was the cradle of banking sector and had a large number of 'no-frills accounts', which would go a long way in getting access to the benefits of banking sector.
He warned private sector banks against adopting ''illegal means'' to recover loan arrears. ''The Reserve Bank has issued clear-cut guidelines on the issue and all the banks should comply with it,'' he said.