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Thursday, August 05, 2021

Maharashtra: ‘More bank branches needed in rural areas to help farmers, local economy’

According to the NABARD status report of 2021-22, "There should be one bank branch for a population of 6,734." However, at present, this ratio is not a reality in many rural areas of Maharashtra.

By: Express News Service | Mumbai |
June 14, 2021 1:38:06 am
Maharashtra: State to challenge Centre’s Banking Act amendments, to move Bombay HC, says ministerThe state government has decided to file a writ petition in the Bombay High Court challenging the amendments in the Banking Regulation Act 1949. (File photo)

The Maharashtra government has asked state-level bankers’ committees to give priority to opening new bank branches in rural parts of the state, in a bid to to provide easy banking access to farmers in rural belts.

State Cooperative Minister Balasaheb Patil said, “The proportion of bank branches should be in ratio to the population of districts. But there are several districts such as Hingoli, Buldhana, Jalna and Nandurbar where the number of banking facilities does not commensurate with the population. Therefore, there is urgent need to open more bank branches in these rural districts.”

According to the NABARD status report of 2021-22, “There should be one bank branch for a population of 6,734.” However, at present, this ratio is not a reality in many rural areas of Maharashtra.

In Hingoli, the number of people per branch is 16,128. In Buldhana, there is one branch for a population of 17,553 and in Jalna, there is one bank branch per 17,884 persons. On an average, across rural Maharashtra, which accounts for 55 per cent population of the state, there is one bank branch per 9,922 persons.

The distribution of banking facilities is heavily tilted towards urban areas as compared to rural Maharashtra. Nearly 65 per cent of bank branches are present in urban areas and only 35 per cent in rural areas. “The total branch network of the state is 17,476. Of the 17,476 branches, only 6,204 are located in rural areas and cater to the rural population,” said Patil.

“The need for strengthening financial infrastructure in rural Maharashtra is necessitated keeping farmers in mind,” he added. As the rural economy is central to the state’s agriculture and cooperative sector, without robust banking facilities, it was difficult to operate in the rural belt, he said.

The stress on better financial institutions and mechanism was also aimed to achieve the target of maximising credit disbursement to maximum number of farmers. The state has set a target to cover at least 80 to 85 per cent farmers within the ambit of financial institutions. The formal mechanism would also be a step to dissuade farmers from relying on private money lenders, who exploit rural masses by charging huge interest rates, sometimes up to 40 per cent, for loans.

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