Finance Ministry wants banks to focus on minorities while lending to priority sector

Finance ministry has asked public sector banks to emphasize on minorities while disbursing credit to priority sector. The ministry has asked the banks to step up advancing credit in districts with heavy density of such communities.

Public sector banks like Corporation Bank, Union Bank of India, Bank of Maharashtra, State Bank of Bikaner and Jaipur and IDBI Bank have not met the stipulated target of lending 10% of the entire priority lending to minorities.

As per the government guidelines, the banks must disburse atleast 40% of their total advances to sectors like micro small and medium enterprises (MSME), agriculture sector, education loan, etc. which are together classified as priority sector.

As per Prime Minister's minority welfare plan of 2006, the banks should emphasize on credit support to weaker section of minority community for self employment. A senior banker added that lack of awareness among the weaker segment of the minorities has made it difficult for the banks to achieve their targets.