The Hindu Business Line : Kerala banks agree to finance small farmers' consortium

COMMERCIAL banks in the State have agreed to spearhead the implementation of Small Farmers' Agri Business Consortium (SFAC), a scheme that builds itself on venture capital assistance.

In a decision taken at a meeting of the State-level Bankers' Committee (SLBC) on Tuesday, the banks agreed to earmark a separate fund for the purpose.

Earlier, the Minister for Irrigation, Mr Thiruvanchoor Radhakrishnan, who inaugurated the meeting, urged banks to grant more educational loans and settle numerous complaints reported in this regard.

In discussions that followed, the banks discussed the scheme of the Department of Education for providing insurance to students availing themselves of educational loans.

The scheme provides coverage for accidental insurance, not life. The bankers decided to request the Government to formulate a scheme providing comprehensive coverage for students.

The Minister also requested the banks to step up lending under the PMRY scheme and assist the `Prathyasa' scheme of the State Government.

The revenue recovery drive in the co-operative sector has been suspended for six months now. The Government is expecting support from the commercial banks in this regard so that the poor beneficiaries get extended time for loan repayments.

The Minister also exhorted the banks to assist the developmental schemes of the Government, especially those falling under the tourism and IT sectors.

The Chairman and Managing Director of Canara Bank, Mr M.B.N. Rao, who presided over the meeting, said that the credit-deposit ration in the State has been growing at a brisk pace, clocking 64.58 per cent as of September.

Domestic deposits also have grown substantially, while the declining trend in non-resident deposits has been arrested.

Commercial banks in the State have disbursed Rs 9,625 crore to the priority sector in the current fiscal.

This is 49.94 per cent of the target of Rs 19,721 crore for the whole year. Of the disbursed amount, Rs 3,677 crore went to agriculture, Rs 1,164 crore to the SSI sector, and Rs 4,784 crore to other priority sectors.

The banks also agreed to assist the State Horticulture Mission's Action Plan 2005-06 to the tune of Rs 37.02 crore. They will also consider extending donations to the School Library Renovation Scheme of the State Education Department. Traditional tribal healing centres will also get finance.