Syndicate Bank, Vijaya Bank sign MOU for financial literacy

Syndicate Bank and Vijaya Bank have executed a memorandum of understanding (MOU) to form a trust exclusively to establish and run financial literacy and credit counselling centres across various lead districts in Karnataka.These will later be extended to other States in the country. The trust, Jnana Jyothi Financial Literacy and Credit Counselling Trust (JJFLCCT), formed jointly by both the banks according to the Reserve Bank of India guidelines, will oversee the establishing and management of these centres in 10 lead districts in Karnataka, to begin with. Mr.D.T.Pai,former CMD,Syndicate Bank will be the Chairman and Managing Trustee of the trust, and will be assisted by two other trustees. The setting up of these centres in rural, semi-urban,urban and even in metropolitan areas according to the RBI's model scheme is aimed at financial literacy and counselling for farming communities and those engaged in allied activities. In urban areas, the focus will be on activities such as individual debt counselling. The centres will educate the farming community on various banking habits and in agriculture and allied activities.(BL 24092010)

Public sector banks set up financial inclusion drive

Public Sector Banks are planning to go the extra mile with their financial inclusion efforts. While the Government has asked them to provide basic banking services to all unbanked villages with a population of over 2000 by March 2012, the Banks are gearing up to cover even villages with population of between 1000 to 2000. This was indicated by top public sector banks at a meeting held to review the progress made by banks in achieving the financial inclusion plan for 2010-2012 at the Indian Banks' Association on Thursday. Over 73,000 unbanked villages in the country have been allotted to different commercial banks for coverage through the bank's financial inclusion plans. (BL 24092010)

RBI asks banks to beef up deposits

Worried over bank's reluctance to increase deposit rates despite its signal, the Reserve Bank of India(RBI) has prodded banks to beef up efforts to mobilise deposits. At a recent meeting with the country's top bankers, RBI officials , led by Dy.Governor Subir Gokarn, expressed concern over the tardy growth of term deposits. Deposit growth has been just 14.44% for the year to August 27, far below RBI's projection of 18%. This is mainly due to unattractive rates. With inflation close to double digits, the real returns are negative. Though RBI raised repo and reverse repo rates by 25 and 50 basis points (bps), respectively, on September 16, most banks are yet to take its cue. A day after, the country's largest lender, SBI, said it was not likely to raise rates before 3-6 months. According to bankers, the regulator wants that availability of money should not be a constraint to corporate India's growth. Banks,on the other hand, do not see an immediate need to raise rates as demand for loans has not picked up significantly. Banks credit growth till now has been in line with RBI's projection of 20% for 2010-11.Rather than raising term deposit rates, which are more stable, banks are rushing to raise short-term funds. (BS 23092010)