Kandi (West Bengal), Feb 6 (IANS) The country’s largest lender State Bank of India is eyeing Rs.3 lakh crore rural deposits and Rs.1.75 lakh crore rural advances by the end of fiscal 2010-11, a senior bank official said Sunday.
“Currently, rural deposits and advances stand at Rs.2.89 lakh crore and Rs.1.6 lakh crore respectively,” SBI’s deputy managing director (Rural Banking) R.Venkatachalam told media persons on the sidelines of a programme here.
Thirty-six percent of the bank’s total deposits are in rural areas, which also constitute 32 percent of the total advances.
Asked whether the bank is extending loans to the micro-finance institutions (MFIs) in the wake of the happenings in Andhra Pradesh , the official said: “My bank is extending loans to MFIs, except in Andhra”.
“We are watching the cash flow situation in Andhra. After Andhra, there is no default,” he added.
The MFI sector has come under the scanner, with the Andhra Pradesh government passing a stringent ordinance in November to put a check on the high rates charged and allegedly coercive loan recovery methods used by the institutions, which allegedly triggered a spate of suicides by borrowers in the state. The ordinance was later converted into an act.
To a query, Venkatachalam said SBI’s non-performing assets in rural banking were 3.5 percent.