Banking Frontiers

Banking in Goa

- mehul@bankingfro­ntiers.com

Banks in Goa have been performing well, reaching out to the masses and offering timely assistance:

The banking outreach in Goa can be described as excellent with total 821 branches of 37 commercial banks (650 branches), 59 branches of the state cooperativ­e bank and 105 branches of 15 urban cooperativ­e banks at the end of FY 2018-19. There were 298 ATMs as of 2017-18. These details are brought out in a booklet titled ‘Role of NABARD in Goa 2018-19’, prepared by Kamakshi Pai, GM/ officer in-charge, NABARD, Panaji.

The South Goa district has over 47 banks operating through a network of 422 rural and semi urban branches. There are 33 commercial banks (with 340 branches), the state cooperativ­e bank (31 branches) and 13 UCBs (51 branches). There are 50 PACS and 65 cooperativ­e credit societies in the district. Goa does not have any DCCBs or RRBs. There are 53 banks operating through a network of 399 rural and semi urban branches in North Goa district.

Ulhas Phaldesai, chairman, Goa State Cooperativ­e Bank, says the bank has 23 ATMs in the state and no ATMs were added in 2018-19. All the ATMs are in urban areas. The total customer base of the bank is 369,000.

Goa is 100% financiall­y included. The lead bank is State Bank of India with 54 branches. India Post Payments Bank commenced its operations with a branch at Margao and 4 access points (post offices) as its outlet for delivery of financial services.

CREDIT POTENTIAL

The Potential Linked Credit Plan (PLP) prepared by NABARD for 2019-20 for South Goa projects a credit potential of `36.80 billion under priority sector as compared to `36.35 billion during 201819, an increase of 1%. The ground level credit in South Goa under priority sector in 2015-16, 2016-17, 2017-18 were `19.73 billion, `24.73 billion and `24.08 billion respective­ly. During 2017-18, the priority sector achievemen­t was 67%.

Kamakshi Pai says projection­s for crop loans (at `2.22 billion) account for about 43% of the total farm credit of `5.22 billion. The balance 57% is for term lending activities in the farm sector, which will lead to long term capital formation leading to better farm incomes on a sustainabl­e manner and help achieve the aim to double the farmers’ income by 2022, she adds.

The Area Developmen­t Schemes formulated by NABARD on commercial cashew cultivatio­n and dairying are being implemente­d in 3 blocks of South Goa. Land title issue is a serious impediment for issue of crop loans by banks.

In tune with its service sector economy, the performanc­e of MSMEs has been adequate for the last few years. Says Kamakshi Pai: “The potential under this sector has been assessed at `17.92 billion (nearly 50% of the total priority sector). The other priority sector (export credit, education, housing, renewable energy and social infrastruc­ture) projection­s have been pegged at `13.66 billion.”

The thrust areas for 2019-20 would ideally be a more focused approach to group lending while also ensuring setting up of agri-enterprise­s leveraging on primary processing and storage facilities.

The South Goa district is well developed as far as social infrastruc­ture is concerned. NABARD support by way of Rural Infrastruc­ture Developmen­t Fund (RIDF) / Warehousin­g Infrastruc­ture Fund (WIF) / NABARD Infrastruc­ture Developmen­t Assistance (NIDA) can be tapped to build additional infrastruc­ture.

The ground level credit in North Goa under priority sector in 2015-16, 2016-17, 2017-18 was `23.04 billion, `22.82 billion and `29.16 billion respective­ly. During 2017-18 the priority sector achievemen­t was 81%. The major economic activities in North Goa district are tourism, mining, agricultur­e and fisheries.

The Goa government initiative for community farming is being supplement­ed by NABARD. Says Kamakshi Pai: “More community farming projects need to be encouraged. The state government should introduce Agricultur­al Land Leasing Act to enable formal leasing of land. This would help cultivator­s to access credit and farm related benefits and prevent misuse of benefits by owners not cultivatin­g the land.”

She requests t he government to reform inheritanc­e laws to resolve issues relating to title deeds. She also suggests that the state revenue department may create infrastruc­ture for online creation of charge on land documents of borrowers. The SLBC should also monitor issuance of RuPay cards to all KCC account holders /

farmers in coordinati­on with agricultur­e department as envisaged by government of India, she adds.

There is a good potential for micro irrigation projects under Jal Shakti in the state and Kamakkshi Pai says the state water resources department / agricultur­e department should consider popularizi­ng micro irrigation systems among farmers, especially in command areas of irrigation projects.

LOANS FOR SHG

Kamakshi Pai has requested the Rural Developmen­t Agency (RDA) of the state government and the Goa State Rural Livelihood Mission (GSRLM) to introduce interest subvention scheme as envisaged under NRLM for helping SHGs access concession­al loans in South Goa district, on the lines of North Goa which is a Women SHG district, and for issuance of chip-based cards to SHGs where details of SHG members are populated. Owing to poverty levels, the progress under the SHGbank linkage program has been poor with only about 23% of the SHGs being credit linked in South Goa. NABARD project for digitizati­on of SHGs – EShakti – is under progress in the district.

LONG TERM PROJECTS

NABARD has cumulative­ly sanctioned `18.76 billion and disbursed `12.04 billion in Goa for 201 projects as of 2018-19. The constructi­on of Atal Setu, a cable stayed bridge, across Mandovi river, has been sanctioned under NABARD Infrastruc­ture Developmen­t Assistance with a loan assistance of `4.62 billion to Goa State Infrastruc­ture Developmen­t Corporatio­n.

Of this, `1.75 billion was disbursed during 2018-19, completing 100% finance under the project.” The long-term refinance disbursed in Goa to the banks during 201819 is `658.3 million. Kamakshi Pai says the banks which have availed this refinance include RBL Bank, IndusInd Bank, Yes Bank and Ujjivan SFB.

Various steps have been taken by the state government for creation of rural infrastruc­ture with support of NABARD. It has requested the state government to prioritize projects for future assistance during the year and the bankers to leverage the infrastruc­ture already created to provide finance for income generation activities. The Goa regional office had recently organized a state level workshop on Dairy Entreprene­urship Developmen­t Scheme and other government-sponsored schemes.

According to chief minister Pramod Sawant, the long pending demand of RBl for a plot of land at Patto, Panaji has finally been approved. There are 4.7 million bank accounts in the state which is almost 3 accounts per person in different banks. The state government is giving interest free loans to students and the repayment percentage is 99. The government is spending `500 million monthly towards the DDSSY and Grih Addhar scheme, but many a times the government is not able to release the pension on the stipulated day due to cash flow / technical issues. The chief minister has requested the banks to explore the possibilit­y of a tie-up under which the banks will release pension on due dates and then obtain reimbursem­ent from the government.

 ??  ?? Kamakshi Pai recommends that more community farming projects need to be encouraged by the government
Kamakshi Pai recommends that more community farming projects need to be encouraged by the government
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