Banks told to tap rural markets for financial inclusion

“I advise banks to transform savings from semi-urban and rural markets into financial assets through effective financial inclusion,” Mukherjee told PSU bank heads here.

He said financial sector is growing at a fast pace and provides growth opportunities unparalleled and unmatched by the mature financial markets around the world.  He said with the improvement in banking technology, efforts to spread banking activities to all will increase the customer base of banks. “Financial inclusion initiatives will strengthen financial deepening,” Mukherjee pointed out.  Mukherjee said as of Tuesday, only 37.2 per cent of bank branches in the country were in rural areas and only 40 per cent of the population had bank accounts. He said that there were 19,141 areas with population above 2,000 as per the 2001 Census that did not have banking facilities in the Northern states. The Centre has set a target to provide banking facilities to areas with population above 2,000 by March 2012, he said, adding that credit-deposit ratio of northern states except that of Chandigarh is not satisfactory against the benchmark of 60 per cent.He also asked the states, which are signatories to the revival package for short-term cooperative credit structure, to take up reform measures required to be put in place to avail of the central funds.

Mukherjee also asked chief ministers to regularly review the progress of the centrally-sponsored schemes to take desired benefits to the common man. He said implementation of Aam Admi Bima Yojana and Swavalamban or the contributory pension scheme, are priorities of the Centre.