Regional rural banks cover 573 districts

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New Delhi, Mar 4 (UNI) Even as the Central government decides procedures to implement the Rs 60,000-crore farm loan waiver across the country by June, Minister of state for Finance Pawan Kumar Bansal today informed the Rajya Sabha that with the opening of more branches of regional rural banks (RRBs) in 39 districts, altogeher 573 districts have now been covered by RRBs.

In a written reply, he said Reserve Bank has granted licenses for opening 321 more RRB branches in the uncovered districts.

It is estimated that RRBs will be tasked with writing off loans of Rs 12,000 crore. Of the remaining, Rs 37,000 crore are to be repealed by cooperative banks, while scheduled commercial banks will forego Rs 11,000 crore to fulfil the waiver.

Meanwhile, the Rangarajan committee on financial inclusion has recommended that semi-urban and rural branches of commercial banks and RRBs should advance loans to at least 250 new cultivator and non-cultivator households per branch per annum.

Mr Bansal informed the House that the committee suggested that loans should be given to marginal farmers and poor non-cultivator households for achieving financial inclusion.

The Minister said the government has decided to set up two funds with a corpus of Rs 500 crore each for the purpose. While the Financial Inclusion Fund (FIF) will meet the cost of promotional and developmental interventions by such banks, the Financial Inclusion Technology Fund (FITF) bear the cost of technology adoption. The Central Government, Reserve Bank and and National Bank for Agriculture and Rural Development (NABARD) will contribute for these funds, he said in replay to another question.

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