The Hindu Business Line : Union Bank to focus more on rural credit

Following the success of its Village Knowledge Centres spread across 101 rural pockets, Union Bank of India plans to give greater thrust to rural and agricultural credit from this year onwards.

At his first interaction with the media after having taken over as the Chairman of the Union Bank, Mr M.V. Nair said: "The services and industrial sectors have placed India on a high growth trajectory and agricultural growth rate of 4 per cent is essential to sustain the momentum. With loan recovery rate in agriculture becoming better than that in industry in several instances, banks are critically placed to promote agricultural and rural credit."

Under the concept, which was started 10 months ago from the rural village of Keechery in Kerala, the Village Knowledge Centre is developed by Union Bank's local rural branch, which provides a computer with Internet connection to the village, as well as literature on the crops grown in the area, current developments in the markets and prices. Inclusive banking is practised by providing a bank account to every one of the households in the village.

The bank, which has 2,080 branches across the country, plans to create a village knowledge centre at every one of its 800 rural branches. The knowledge centres are expected to promote crop diversification, augment productivity and extend horticultural practices, Mr Nair said.

The bank, which is undertaking an indebtedness survey covering every household in the village knowledge centres, is simultaneously working with self-help groups to transform the village.

Having obtained permission from the RBI to open two overseas branches at Hong Kong and Doha, and two representative offices in Shanghai and Dubai, the bank is in dialogue to obtain the host countries permission.

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