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November 22, 2013

WB CM flags off electronic banking services for rural areas

WB CM flags off electronic banking services for rural areas

In an attempt to encourage banks to set up branches in rural areas, the state government has decided to provide them space in Panchayat offices for Re 1.

To start with, UBI has opened 49 such branches in rural Bengal. 

While inaugurating the branches from Nabanna, Chief Minister Ms. Mamata Banerjee said according to the usual norm a bank eager to set up a branch in rural areas has to first procure a plot and sometimes availability of space can be a problem. The government has thus decided to help the banks and provide infrastructure. Banks will not have to look for a plot now as spaces will be allotted in the Panchayat offices. The banks will have to pay rent of only Re 1, the Chief Minister said. 

Banking services have not reached 938 Gram Panchayats in the state. The government has already taken up the matter with State Level Bankers` Committee. Apart from UBI, some other banks, including SBI, UCO and Allahabad Bank, have approached the government to set up branches under this model.   

Ms. Banerjee said branches will be set up in 50 per cent of these Gram Panchayats within a year and it will take another year to start banking services in the remaining areas. 

“Easy access to banks will prevent people from investing money in chit funds. The facility will help everybody ~ from farmers to students,“ said the chief minister.

An official of the state Finance Department said an area of around 300 to 400 square feet will be provided in 49 panchayat offices. “A total of 1,000 accounts have already been opened in these branches and this has amounted to a total of Rs 6 crore,“ he said. 

This is an innovative model and West Bengal is the first state to help banks in such a way and reach rural areas, he added.  The move will also help raise the credit-deposit ratio that has dipped recently.