CM lambasts banks for poor credit flow

In a severe indictment of the “lackadaisical approach” of banks in the State towards disbursement of credit to the priority sectors, Chief Minister Jagadish Shettar observed on Tuesday that the banks were acting extremely cautious of negative growth or underachievements in case of loans to weaker sections and minority communities, and loans to educational purposes, housing and micro-enterprises.

Shettar was addressing a meeting of chief ministers and finance ministers of the southern states in the City. He said that the State had the potential and need for higher levels of credit and appealed to the banks to adopt a more pro-active approach for credit flow.

Shettar said the performance of banks in terms of credit flow in Karnataka during the
financial year 2011-2012 was not at its best. There was a decline in credit to deposit ratio and in ratios for primary sector advances, agricultural advances and SC/ST advances to total advances.

Virtually contradicting Union Finance Minister P Chidambaram’s claims on the southern states, Shettar pointed out that in Karnataka, only 8.71 lakh Kisan credit cards were issued by the banks in the financial year 2011-2012, as against the target of 15 lakh new cards.

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