Outlining the government's agenda for increasing financial inclusion in rural areas, finance minister P Chidambaran today said that they would "aggressively" pursue branch expansion of Regional Rural Banks (RRBs) in the current year. The FM also ruled out merging these banks with their sponsor banks. After a review meeting of RRBs today, Chidambaram said these would continue to function under sponsored banks but that RRBs would undergo consolidation.After the performance review meet, Chidambaram said "consolidation would take place among RRBs.few more consolidations would happen and the final number will be 96". Giving a five month time-line for this consolidation process, he said, "We will aggressively pursue the branch expansion programme for RRBs in calender 2007." At present there are 102 RRBs in the country. Pointing out that RRBs were critical instruments to increase financial inclusion, the FM said these banks provided credit to farm sector, rural traders and even artisans. The total business of RRBs has gone up from Rs 82, 464 crore in 2003-04 to Rs 1,11,041 crore by 2005-06. During the same period, agricultural loans also doubled from Rs 7,174.97 crore to Rs 15,298.88 crore. After the meet, the FM said that these banks had been advised to give credit to even those who were outside the priority sector but were equally deserving credit. In all, eight subjects were discussed during the meet, including branch expansion, networking, human resources, information technology and deposit mobilisation.
