The Hindu Business Line : Database on non-farm mortgage loans planned

Bangalore, July 4 A group of banks have come together for setting up a control registry mechanism that involves creation of a data base on mortgage loans for non-agricultural property.

The banks included Syndicate Bank, Canara Bank, State Bank of India, State Bank of Mysore, ING Vysya Bank and Karnataka Bank.

Speaking at the State Level bankers committee (SLBC) meeting here on Friday, Syndicate Bank’s Executive Director, Mr George Joseph, said the mortgage data base would be initially on loans in Bangalore, Mysore, Hubli-Dharwad and Belgaum.

The mechanism was intended to cut fraudulent transactions on mortgage-backed loans in the state. The mechanism is a Web-based solution that would provide information on property mortgaged among the banks.

Mr Joseph, who is also chairman of the SLBC said, the software and the format of the data base for implementing the project, was initiated by Canara Bank. The Reserve Bank of India, however, wanted the mechanism to be extended to housing loan portfolios of all the banks operating in the state.

Referring to the financial inclusion, Mr Joseph said, that the second phase of the financial inclusion had begun in Karnataka. Karnataka already completed the first stage of inclusion, through opening of non-frill accounts for customers.

But the RBI expressed concern over financial inclusion programme in the State. The RBI’s Regional Director, Ms Devaki Muthukrishnan, said, “A study by NABCONs has found that many of the No frill accounts were still not operational.” NABCons, the consultancy arm of the National Bank for Agriculture and Rural Development, was engaged by the RBI to evaluate the impact of financial inclusion.

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