CS calls on RBI to order banks to increase lending to priority sectors at J&K

Srinagar: Banks in Jammu and Kashmir have only reached 43% of the loan target of Rs 9,028 crore to the agricultural sector until the end of March 2021 against the annual target of Rs 20,770 crore.

The banks’ “poor performance” in lending to the priority sector did not work well with the J&K government.

“The chief secretary expressed his concern at the weakness of loans to the priority sector in general and to the agricultural sector in particular despite the immense potential of these sectors,” reads an official document.

“He asked the Reserve Bank of India to review the status and reverse the trend so that the flow of credit is achieved in accordance with the established standards of maintaining a 60% CD ratio with 40% credit to the priority sector. which includes agriculture, MSMEs, export credit, education, housing, social infrastructure and renewable energy, ”one official document reads.

“CS expressed concern that the performance of private sector banks and new generation cooperative banks with respect to priority sector lending in J&K UT has remained unsatisfactory. The lending model of some private sector banks, which are aggressive in lending to non-priority sectors but show a low appetite for lending to priority sectors of the economy, is a matter of concern. “

“The chief secretary has ordered poor performing banks and financial institutions to scale up lending to priority sectors in order to achieve set targets,” he adds.

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