Lok Sabha Question No. 2217 (UNSTARRED), answered on 2016-07-29
Subject: Institution Loan to Weaker Sections
Ministry: FINANCE
Asked by: SADASHIV KISAN LOKHANDE

## Government of India Department of Financial Services Ministry of finance

## LOK SABHA UNSTARRED QUESTION NO. 2217

## TO BE ANSWERED ON THE 29 th  July, 2016, Shravana7, 1938 (SAKA) Institutional Loan to Weaker Sections

## QUESTION

## 2217. SHRI SADASHIV LOKHANDE

Will the Minister of FINANCE be pleased to state:

- (a) whether non-availability of institutionalized loan to the weaker sections of the society is the major reason for poverty;
- (b) if so, the details of loans provided through small loan system to the weaker sections of the country during the last three years;
- (c) whether the Government has taken/ proposes to take any steps to ensure transparency in the said process;
- (d) if so, the details thereof; and
- (e) if  not,  the  steps  taken  to  provide  alternative  banking  facilities  to  weaker  sections  of  the country?

## ANSWER (MINISTER OF STATE IN THE MINISTRY OF FINANCE) (SHRI SANTOSH KUMAR GANGWAR)

- (a) to (e): As reported by RBI, Loans to Weaker Sections under Priority Sector for the last three years are given as under:

Amount in Rs Crore

| 2014            | 2015            | 2016            |
|-----------------|-----------------|-----------------|
| Amt outstanding | Amt outstanding | Amt outstanding |
| 493969          | 567129          | 686528          |

Reserve  Bank  of  India  (RBI)  has  issued  Master  Direction  dated  07.07.2016  and  two Master Circulars dated 01.07.2016 relating to Priority Sector Lending (PSL) and credit flow to Weaker Sections. These prescribe the following:

- i)    A target of 40 per cent of Adjusted Net Bank Credit (ANBC) or Credit Equivalent amount of Off Balance-sheet Exposures (OBE), whichever is higher, as on March 31 of the previous year, for lending to the priority sector by Scheduled Commercial Banks (SCBs) including Public Sector Bank (PSBs). Within this, a sub-target of 10 per cent of ANBC or Credit Equivalent amount of Off Balance-sheet Exposures (OBE), whichever is higher, as on March 31 of the previous year, has been set for lending to Weaker Sections. This includes among  others  small  &  marginal  farmers,  Scheduled  Castes  (SCs)  &  Scheduled  Tribes (STs), Self Help Groups, Individual women beneficiaries up to Rs.1 lakh per borrower and Minority communities.
2. ii) Small & Marginal Farmers:

A  target  of  18  percent  of  ANBC  or  Credit  Equivalent  Amount  of  Off-Balance  Sheet Exposure, whichever is higher, has been set for Agriculture. Within   the   18   percent   target for agriculture, a target of 8 percent of ANBC or  OBE ,  whichever  is higher   is   prescribed for   Small   and Marginal  Farmers,  to  be  achieved  in  a phased manner i.e., 7 per cent by March 2016 and 8 per cent by March 2017.

## iii) SCs/STs:

-   At the block level a certain weightage is to be given to scheduled castes / scheduled tribes in the planning process.
- Credit  planning  should  be  weighted  in  favour  of  SCs/STs.  Loan  proposals  of  these communities should be considered sympathetically and expeditiously.
- While  'adopting'  villages  for  intensive  lending,  villages  with  sizeable  population  of these communities may be specially chosen.
- Banks  should  not  insist  on  deposits  while  considering  loan  applications  under Government  sponsored  poverty  alleviation  schemes  /  self-employment  programmes  from borrowers belonging to SCs / STs.
- If applications in respect of SCs / STs are to be rejected, it should be done at the next higher  level  instead  of  at  the  branch  level.  Further,  reasons  for  rejection  of  applications should be clearly indicated.

## iv)  Minority Communities:

Government of India has forwarded a list of 121 minority concentration districts having at least  25%  minority  population.  Accordingly,  scheduled  commercial  banks  are  required  to specially monitor the credit flow to minorities in these 121 districts, thereby ensuring that the minority communities receive a fair and equitable portion of the credit within overall target of the priority sector.

Further, under the Prime Minister's 15 point programme, the Public Sector Banks were advised by the Government to step up their Minority Community Lending (MCL) to 15% of their Priority Sector Lending (PSL).

With a view to 'Fund the Unfunded' segment of society and to bring them under formal credit system through Banks, NBFCs, Pradhan Mantri Mudra Yojana (PMMY) was launched on  08  April  2015.  PMMY  focus  micro  enterprises  loans  upto  Rs.  50,000/-  under  `Shishu' category, loans from Rs. 50,001 to Rs. 5 lakhs under `Kishore' category and loans from Rs. 5 lakhs to Rs. 10 lakhs under `Tarun' category.

Category wise progress under PMMY as given below:

## I.  Since inception to 31.03.2016

| Category            |   No. of A/C |   Sanctioned Amt in Crore |   Disbursed Amt. in Crore |
|---------------------|--------------|---------------------------|---------------------------|
| SC                  |      6114737 |                     14975 |                     14692 |
| ST                  |      1678346 |                      4878 |                      4742 |
| Women entrepreneurs |     27628265 |                     82183 |                     63190 |
| Minority            |      4088210 |                     14018 |                     13560 |
| Total               |     39509558 |                    116054 |                     96184 |

## II. From 01.04.2016 to 15.07.2016

| Category            |   No. of A/C |   Sanctioned Amt in Crore |   Disbursed Amt. in Crore |
|---------------------|--------------|---------------------------|---------------------------|
| SC                  |      1480400 |                      3408 |                      3205 |
| ST                  |       376850 |                       949 |                       917 |
| Women entrepreneurs |      6137223 |                     13989 |                     13648 |
| Minority            |      1053701 |                      3238 |                      3003 |
| Total               |      9048174 |                     21584 |                     20773 |

To  ensure  effective  implementation,  credit  flow  to  the  weaker  sections  is  being monitored by the Government/RBI.

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