PM asks bankers to encourage farmers, entrepreneurs to use institutional credit
Banks should identify bankable projects and ensure that they are funded on the basis of their merits
Prime Minister Narendra Modi has called upon stakeholders from banks and NBFCs to motivate Self Help Groups, farmers, small entrepreneurs to use institutional credit to meet their credit needs.
“Each bank needs to introspect and take a relook at its practices to ensure stable credit growth. Banks should not treat all proposals with the same yardstick and need to distinguish and identify bankable proposals and to ensure that they get access to funding on their merit and don’t suffer in the name of past NPAs,” the Prime Minister said while talking to banks and NBFCs stakeholders on Wednesday.
According to a press note issued by the Prime Minister’s Office, during the meet, Prime Minister assured bankers that the government is firmly behind the baking system and that it is “ready to take nay step necessary to support it and promote its growth.
He also asked them adopt financial technology like centralized data platforms, digital documentation and collaborative use of information to move towards digital acquisition of customers. Such moves, as per the Prime Minister, will help “increase credit penetration, increase ease for customers, lower costs for banks and also reduce frauds.”
India has built a robust, low cost infrastructure which enables every Indian to undertake digital transactions of any size with great ease. “Banks and Financial Institutions should actively promote the use of RUPAY and UPI amongst its customers,” the Prime Minister said.
The progress of schemes like emergency credit line for MSME, additional KCC cards, liquidity window for NBFC and MFI was also reviewed.
While it was noted that significant progress has been made in most schemes, banks need to be proactive and actively engage with the intended beneficiaries to ensure that the credit support reaches them in a timely manner during this period of crisis.