Chief Secretary asks banks to scale up priority sector lending in JK

As per the official note, against the target of Rs.35,482.62 crore, the priority sector lending was only Rs.14,105.47 crore, which represented a mere 40 percent achievement in the financial terms.

Chief Secretary, Dr Arun Kumar has expressed serious concern over the poor lending to the agriculture sector.

The Chief Secretary expressed his concern over poor lending in the priority sector, in general, and agriculture sector, in particular, despite immense potential in these sectors.

He appreciated the performance of the banks in the non-priority sector lending, however, he said banks need to find ways and means to urgently improve priority sector lending as the Government and the financial sector cannot be remiss in their duties to get credit to the people /sector where it is needed the most.

"CS stated that the policy imperative underlying the public sector lending was to  meet the constitutionally sacrosanct social obligations and the consequential responsibility of financially empowering the traditionally muted and underprivileged people" read a note of the minutes of the meeting of union territory level bankers committee. 

"He observed that lending to the priority sector has not improved despite consistent calls/advisories from this House to the banks to improve lending to these sectors," it read.

The Chief Secretary stated that a new institutional framework for planning, execution and oversight, therefore, needs to be put in place as the existing system has not been delivered, and has been found to be unresponsive to the needs of the priority sector.

The Chief Secretary further directed banks to desist from seeking collaterals for the loans where it is not required under norms and operates within the ambit of the RBI norms/GOI schemes in the course of processing loan requests.

As per the minutes of the meeting, the General Manager, Reserve Bank of India (RBI), suggested that the Sub-Committee of UTLBC on Priority Sector constituted by RBI under the chairmanship of CGM NABARD should invite the HODs of concerned Government departments to the meetings of the sub committee.

"Banks to urgently improve lending in the Priority Sector, which has remained suboptimal. All banks submit monthly plans for effecting improvement in lending to UT LBC within a week positively. UTLBC shall monitor the performance of banks and submit regular reports to the Finance Department in this regard," it further read.