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RBI governor tells banks to speed up reach to people

By IANS,

Bangalore: Reserve Bank of India (RBI) Governor Duvvuri Subbarao Monday urged state-run banks to speed up financial inclusion to reach the people by opening up more Financial Inclusion Resource Centres (FIRCs) across the country.

“Though we are doing our bit by opening our own FIRCs, it is not enough. Commercial banks should also open such centres to function as storehouse of all information pertaining to financial inclusion,” Subbarao told reporters after unveiling an FIRC at the local office of the central bank here.

As per the central bank’s financial inclusion plan, banks have been directed to provide basic services in all villages with a population of 2,000 and above by 2012.

The RBI plans to open soon two resource centres in Kolkata and Mumbai in addition to similar centres at Pune and Chandigarh that were set up recently.

“As majority stakeholders in the financial inclusion process, state governments should ensure better governance and transparency while banks should strive to get low-cost deposit base to protect them from asset-liability mismatch,” the RBI governor said on the occasion.

Noting that the financial inclusion process in many regions was slow, Subbarao said banks should expedite the process by appointing about 200,000 business correspondents and customer service centres over the next 30 months.

“In addition, state-run banks should open at least 4,000 branches in unbanked villages and 100 million no-frill accounts by 2012-13,” Subbarao said.

In a bid to speed up the financial inclusion process, the RBI recently modified the policy to allow for-profit organizations to act as business correspondents in villages across the country.

“Commercial banks should see financial inclusion as an opportunity and not a mere obligation and should achieve targets by using technology,” Subbarao added.