The video of a 60-year-old woman dragging her bedridden centenarian mother on a charpoy, which went viral on Sunday, highlights the problem that villagers face in accessing banks.
It has also touched upon another issue — the reluctance of many banks to open branches in rural areas and inadequate staff in the existing ones to handle rising banking demands of the villagers.
“The commercial banks are mostly urban oriented. Except the SBI, UCO Bank, Union Bank of India, Indian Overseas Bank and Bank of India, other banks do not have sizeable presence in the rural areas,” says the State Focus Paper 2020-21 of National Bank for Agriculture and Rural Development (NABARD).
The Regional Rural Banks, which have a good number rural branches, are not in robust financial health.
There were two Regional Rural Banks (RRBs) with a network of 987 branches (786 rural, 156 semi-urban and 45 urban branches.)
“During 2018-19, both incurred losses. Their net loss increased from ₹216.12 crore as on March 31, 2018 to ₹596.82 crore,” says the focus paper.
“The net worth of the Utkal Grameen Bank was negative at (-) ₹54.17 crore as on March 2019. The net worth of both RRBs declined by 89.71% during 2018-19,” the apex rural bank points out.
According to the NABARD’s annual assessment report, while NPA (non-performing assets) as percentage of loans and advances increased from 25.60% as on March 31, 2018 to 27.17% as on March 31, 2019, recoveries as a percentage of demand decreased from 67.81% in 2017-18 to 58.16%. Due to poor financial health, banks are often found to be understaffed.
At the State Level Bankers Committee meeting held on May 28, Chief Secretary Asit Tripathy drew their attention on lower number of branches in Odisha compared to other States.
“Banks should open branches in panchayats which lacked fully operational branches,” Mr. Tripathy told them.