The Hindu Business Line : Priority sector lending up 7 pc at Rs 22,466 crore in Karnataka

BANKS in Karnataka have extended the period for loans worth Rs 400 crore given for crops and through Kisan Credit Cards (KCC) in view of the drought conditions prevailing in the State.

Of the total amount, Rs 106 crore accounted for KCC outstandings. The loans under the schemes are usually given for a short term. As part of the relief, bankers have also issued KCCs to 25,066 more farmers who hold crop loan account with them. As many as 1,26,789 credit cards were issued during the year 2003-04, whose outstanding have been rescheduled.

Stating this here today at the 89th State Level Bankers' Committee (SLBC) meeting, Mr K.M. Shet, Executive Director, Syndicate Bank, said the panel's measure along with the Government' s own Rs 850-crore relief package announced early this year should help the farmers overcome the crisis situation.

On priority sector lending, Mr Shet said that priority sector lending exceeded the stipulated norm by almost by seven per cent at 46.93 per cent during the nine-month period up to December 2003, at Rs 22,466 crore. A similar achievement in the agriculture sector was recorded during the period when advances of Rs 9,476 crore, constituting 42.17 per cent of the total lending of scheduled commercial banks and accounting for 19.79 per cent of total advances were made.

Earlier, in her address, Ms Devaki Muthukrishnan, Regional Director, Reserve Bank of India, Bangalore, said that the banks should step up their effort to achieve the stipulated target of 10 per cent as against the current level of 8.1 per cent in lending to weaker section.

She hoped the Advisory Committee on Flow of Credit to Agriculture set up by SLBC would submit its report soon to streamline credit assessment and deliver system for the farm sector.

She expressed concern at the "increasing number of frauds" taking place in the area of housing, retail and consumer finance and exhorted banks to exercise caution and bring down the same.

In his remarks, Mr Vijay Gore, Additional Chief Secretary & Development Commissioner, complimented the banks for good performance in general. However, he said the performance in realistic terms was far from satisfactory. He requested the banks for issue of Kisan Credit Cards to all the eligible farmers by June 2004.

He noted with concern that banks were not giving timely reports under Crop Insurance Scheme and requested for improved performance in reporting.

Mr B. B. Mohanty, Chief General Manager, Nabard, Bangalore said that Potential Linked Plans for 2004-05 have already been prepared and sent to banks for enabling them to prepare their Service Area Plans. He said that the SHG-Bank Linkage coverage would be 1,02,000 groups during 2003-04 against 62,000 during 2003.

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