Bangalore, Dec 11 (UNI) Union Minister of state for Finance Pawan Kumar Bansal today favored a common strategy between the Union and state government to reduce interest rates on farm loans.
Speaking to news persons here today Mr Bansal said that at present the Union government was bearing the cost of 2 per cent interest subsidy on farm loans. Many of the state governments had also offering interest subsidy to ensure low interest rate. This had to be rationalised, he said.
Mr Bansal, who was here to participate the State Level Bankers meeting scheduled to be held tomorrow, said that Karantaka had done well in implementing the Prime Minister Manmohan Singh's call to achieve cent per cent financial inclusion.
He said that Karnataka was the cradle of banking sector and had large number of 'no-frills accounts', which would go a long way in getting access to the benefits of banking sector.
Replying to questions the union minister warned private sector banks against adopting illegal means to recover loan arrears. "The Reserve bank has issued clear-cut guidelines on the issue all the banks should comply with it," he said.