“Banks should develop their own business models to achieve financial inclusion (FI) roll out”, said Ms Uma Shankar, Regional Director, Reserve Bank of India.
Speaking after inaugurating the credit camp for small and medium sector organised in Bagalkot by Karnataka Vikas Grameena Bank (KVGB), Ms Shankar said banks should also introduce bankable schemes and open financial literacy and credit counselling centres in the North Karnataka to improve the credit flows.
“So far, only about five per cent of the six lakh villages across the country have been provided with banking facilities.
“The task of achieving inclusion of a large populace, who are deprived of banking services, is clear. Thus RBI's main focus is towards promoting greater inclusion,” she added. While appreciating the efforts of KVG Bank under financial inclusion, she said the regional rural banks play a major role in inclusion. Banks should take advantage of simplified procedure of know your customer (KYC) norms towards reaching more people.
“To address the issue of uneven spread of bank branches banks are permitted to freely open branches in smaller towns with population up to 49,999 people.
“Banks were mandated to allocate at least 25 per cent of the total number of branches to be opened during a year to unbanked rural centres,” Ms Shankar added.
A model scheme on Financial Literacy and Credit Counselling Centres (FLCCs) was formulated by the RBI.
In Karnataka, as on date, 30 such centres are functioning covering 27 districts.
“In Karnataka, the RBI had identified nine villages for transforming them into model villages by providing banking facilities to all residents,” she said.
Mr C. Sambasiva Reddy, Chairman of KVGB, appraising the bank's performance and its social involvement said “KVG Bank has taken much care of implementation of financial inclusion and already has appointed 285 business correspondents (BCs) and opened 52 financial inclusion branches.”