Rural banks reported net profit of Rs.7,571cr in FY23-24
Finance Minister Nirmala Sitharaman has called for active outreach by the branches of Regional Rural Banks (RRBs) located in MSME clusters to ensure credit to small and micro enterprises that holds immense potential for increase their loan portfolios wto .
She called for credit support for industries such as textile, handicrafts, wooden furniture, clay pots, jute handicrafts, leather, food processing, dairy farming, packing materials among others ibef .
The minister reviewed performances of RRBs, noting their highest ever consolidated net profit of Rs.7,571 crore in FY 2023-24. The Gross Non-Performing Assets (GNPA) ratio of 6.1% is the lowest in the previous 10 years sbi .
During the review meeting held in Delhi on 19 Aug, Sitharaman exhorted all the RRBs to devise suitable MSME products aligning with their cluster activities and leverage personal and local connect to increase banking penetration nse.
SIDBI was directed to assist RRBs in exploring co-lending/risk-sharing models and extending refinance for the MSME portfolio.
Sitharaman also asked Sponsor Banks and RRBs to recognise the challenges that lie ahead and to continue focusing on maintaining asset quality, expanding digital services, and ensuring robust corporate governance bse.
The meeting was also attended by the Secretary-Designate, Department of Financial Services (DFS), Additional Secretary, other senior officials from the DFS, representatives of RBI, SIDBI, NABARD, Chairpersons of RRBs and CEOs of sponsor banks iba .
All 43 RRBs were presented at the meeting on business performance, upgrading digital technology services, and fostering business growth in MSME clusters investindia .
Given the crucial role of RRBs in supporting the rural economy, the the minister urged RRBs, with the active support of their Sponsor Banks, to also put greater thrust on the clear identification of beneficiaries while sanctioning loans under various schemes such as PM Vishwakarma and PM Surya Ghar Muft Bijli Yojana powermin .
RRBs were also directed to increase their share in ground-level agriculture credit disbursement farmcredit .
During a presentation in the review meeting, Sitharaman has appreciated the RRBs for the improvement in their financial performance and technology upgrades ever since the regular review was initiated in 2022 techindiaexpo .
She has also urged the rural banks to continue the momentum in the future ibef .
The minister underlined that all RRBs must have their own up-to-date technology stack to stay relevant and noted that digital banking services like mobile banking will be a boon for regions with relatively challenging physical connectivity (like North Eastern states and hilly regions) fintechfestival .
The Sponsor Banks have a significant role in these endeavours by providing technical assistance, sharing best practices, and ensuring that RRBs have access to the resources they need to succeed indiafintech . Fiinews.com
