Agricultural credit policies and programmes in India: role of commercial banks with particular reference to State Bank of India
Base, A.
State Bank of India Monthly Review 22(1): 3-20
1983
Document Number: 370405
This background paper prepared for the Fourth APRACA General Assembly in Manila in December 1982 indicates that the entry of commercial banks into the field of rural credit has initiated new trends in rural finance in India. It has acted as a catalyst to grass-root level planning and imparted a significant development orientation to allocation of funds in rural areas. In the process commercial banks have developed certain skills which constitute their strength and need to be capitalized in future planning for the development of rural areas. Three main credit agencies operate in the rural areas: cooperatives, Regional Rural Banks, and commercial banks. Of these the commercial banks have the highest costs but also the highest qualified staff. Thus, while credit supplied by commercial banks is relatively costly (from the national not the borrowers' point of view) they can provide other services to the rural areas such as project formulation, credit planning, technical and extension services, etc. which cannot be supplied by the other two agencies.