Govt. plans banking services in more regions

New Delhi: The government has proposed the setting up of banking facilities in all areas having a population in excess of 2,000 by March, 2012. According to a statement made by the Minister of State for Finance, Namo Narain Meena, in Parliament on Tuesday, the services will be provided by banks using the Business Correspondent Model, with appropriate technology back-up. It will cover around 60,000 habitations.

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The statement further said that in July 2009, around 129 un-banked blocks were identified in the country, which was brought down to 93 in February, 2010, due to the efforts of the Government, the Reserve Bank of India and various banks. In order to extend the reach of banking in rural areas, RBI has liberalized the policy of branch licensing and permitted domestic scheduled commercial banks to open branches in Tier III to Tier VI centres, without having to take permission.

"Low population density, inhospitable terrain, law and order problems and non-availability of basic infrastructure have been indicated as the main impediments in providing banking facilities in these areas," the statement said.