Finance Minister Nirmala Sitharaman urged Regional Rural Banks (RRBs) in the Northeast to boost credit disbursement for agriculture, horticulture, and allied activities under government schemes like MUDRA and PM Vishwakarma. She also directed NABARD to promote FPOs in the region and called for enhancing banking infrastructure and MSME credit solutions
Given the crucial role of Regional Rural Banks (RRBs) in supporting the rural economy, Finance Minister Nirmala Sitharaman on Monday asked them to increase credit disbursement under various flagship schemes of the government such as MUDRA, PM Vishwakarma, etc in the Northeast region.
The minister said that the focus should be on credit for agriculture, horticulture and allied activities like piggery, goatery, sericulture, fisheries etc.
She also directed the National Bank for Agriculture and Rural Development (NABARD) to promote FPOs (Farmer Producer Organizations) in the Northeast region, the finance ministry said in a statement.
Sitharaman gave these directions during a meeting in Itanagar to review performance of seven RRBs of the Northeast Region covering the states of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland and Tripura in Itanagar, Arunachal Pradesh.
During the review meeting, the minister was apprised about the improvement in the financial performance of the RRBs of the North East and their technology upgradation ever since the regular review was initiated in 2022.
The Consolidated Capital to Risk-weighted Assets Ratio (CRAR) of 15 per cent in FY24 is at healthy levels and profitability has improved from losses of Rs 11 crore in FY23 to net profit of Rs 205 crore in FY24.
The Gross Non-Performing Assets (GNPA) have also improved from 15.6 per cent in FY22 to 7.3 per cent in FY24.
During the meeting, Sitharaman emphasized that every eligible person in the North-East region should get covered under Pradhan Mantri Jan Dhan Yojana (PMJDY).
The minister directed the Department of Financial Services to conduct a meeting with the Ministry of DoNER and NEC (North Eastern Council) to explore the possibilities for extending credit to ODOP vendors of the states.
The minister urged stakeholders to hold special State Level Bankers' Committees (SLBCs) meetings involving RRBs to explore the possibility of tapping the potential of horticulture, floriculture, sericulture & animal husbandry in the North Eastern states; resolve the issue of availability of land records for extending Agri credit and; increasing credit for agri-processing units. States were urged to ensure the provision of mobile veterinary units in each district.
She also advised that all RRBs must devise suitable MSME products that align with MSME activities and leverage their personal and local connections to increase penetration.
RRBs, with necessary support from sponsor banks and NABARD, were also directed to open new banking touchpoints in non-covered areas, especially in the states of Nagaland and Arunachal Pradesh.