JOIN USForty-four years after it was conceived by the Gadgil Study Group in October 1969, and its consequent implementation by the Reserve Bank of India (RBI) the same year, the ‘Lead Bank Scheme’ (LBS) will finally be introduced in metropolitan cities, with the intention of addressing a much neglected constituency -- the urban poor.
“The scheme emphasises making specific banks in each of the cities key instruments of local development by entrusting them with the responsibility of locating growth centres, assessing deposit potential, identifying credit gaps and evolving a co-ordinated approach to credit deployment, in concert with other banks and credit agencies,” an RBI official said on Saturday.
Stating that the scheme will give the urban poor access to doorstep banking, as also enable direct transfer of cash benefits if they fall under any of the social welfare schemes, the official said, “Given that the challenge of financial exclusion is widespread in metropolitan areas also, especially amongst disadvantaged and low-income groups, LBS, for the first time will be extended to the urban areas.”
This is being done with the objective of providing an institutional mechanism for co-ordination between government authorities and banks, facilitating doorstep banking to the excluded segment of urban poor, and to implement DBT, the official added.
The identified lead banks will be responsible for ensuring that the genuine needs of people for clean notes and coins are appropriately met through proper coordination with the Currency Chests and Small Coin Depots situated in that area. The move is in line with the RBI’s financial inclusion policy, and the apex bank has even directed banks to prepare a detailed plan for the next three years.
Confirming the same, RBI spokesperson Alpana Killawala said, “A decision to this effect has been taken and soon the scheme will be extended to the cities. The scheme will help create a financial environment that will help target customers get access to banking facilities, and related services in line with our financial inclusion plan.”
The RBI has also advised banks to hold camps to open bank accounts for eligible persons and has advised them to put in place effective monitoring systems.
RBI's had suggested at the fag end of its monetary policy statement on Friday that banks have a more pronounced stake in the distribution of bank notes and coins and also facilitate their uninterrupted supply in places other than metropolitan and urban centres.