Corp Bank to extend branchless banking in 6,000 villages

The existing operations of branch-less banking facility in 1,700 villages would be extended to almost 6,000 villages, particularly reaching out to the farmers' doorstep, Corporation Bank Chairman and Managing Director Ramnath Pradeep told reporters here.

Pradeep claimed RBI restrictions of disallowing the landing to the farmers through via-media like Food Corporation of India (FCI) or Mills has resulted in the bank falling short of its target of 13 per cent lending to the agro-field.

The bank has now decided to directly connect to the farmers with the landing facility and a bank account of their own.

"They would be serviced through Branch-less banking wherever there is no place available to set up a branch," the CMD said.

The branch-less banking is a model pioneered by the Corporation Bank since November, 2006.

"The bank has adopted a unique model where the business correspondent is a permanent resident of the village and is available throughout the day for the villagers for the banking facility," Pradeep said.

The bank, who claims to have NPA of less than one per cent, is also wary about the high percentage of NPA in the agriculture sector.

Pradeep said agriculture sector has 3 per cent NPA, while housing has 2 per cent and the corporate is less than one per cent.

He claimed that high NPA in agro-sector was largely because of huge landings made by the bank to the Coffee farmers from Karnataka's Chikmangalur region.

The bank had extended loans of Rs 200 crore to the farmers for the last FY, which were not paid.

"The farmers are paying back now and the recovery to the tune of Rs 100 crore is already made," the CMD said.

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