Union Minister for Finance and Corporate Affairs Nirmala Sitharaman on Thursday chaired a review meeting to assess the business performance of Karnataka Grameena Bank (KaGB) in Ballari, Karnataka. The meeting was attended by M. Nagaraju, Secretary (DFS), Shaji K. V., Chairman of National Bank for Agriculture and Rural Development (NABARD), Executive Director of Canara Bank, and senior officials from the Ministry of Finance.
During the review, FM Sitharaman assessed key indicators, including credit growth, non-performing assets (NPAs), performance under financial inclusion, and implementation of government-sponsored schemes. She urged the Karnataka Grameena Bank to increase its share in agriculture credit disbursement and focus on emerging areas of the rural economy.
The Finance Minister directed the Karnataka Grameena Bank and its sponsor bank to work closely with state government departments to scale up credit flow to MSMEs and allied agriculture sectors. Highlighting new opportunities created by GST rate rationalisation, she encouraged rural banks to tap into rising consumption trends in semi-urban and rural areas to expand their lending portfolios.
FM Sitharaman also stressed the need to support Farmer Producer Organisations (FPOs) by providing working capital financing. “Rural banks should upgrade their products and services to meet the needs of FPOs. This will enable both banks and FPOs to leverage their resources for mutual benefit and sustainable growth of the rural economy,” she said.
Pointing to the shift of services such as data centres from tier-1 to tier-2 and tier-3 cities, the Minister urged rural banks to capitalise on such emerging opportunities to strengthen their financial health. She advised the bank to improve asset quality, adopt modern technology, and enhance customer service delivery to ensure profitability and operational efficiency.
FM Sitharaman also asked the Karnataka Grameena Bank and its sponsor bank to engage with panchayat and district-level committees to improve the screening of applications under government schemes such as PM Vishwakarma and PM Formalisation of Micro Food Processing Enterprises Scheme (PMFME). She further encouraged the bank to expand its presence in the Kalyan Karnataka region by opening new branches in underserved areas.
DFS Secretary Nagaraju highlighted the completion of system integration post-amalgamation and underlined the importance of a medium-term business plan for the bank’s long-term sustainability. He noted the significant potential in agro-processing and MSMEs in the region and urged the Karnataka Grameena Bank to collaborate with NABARD for value creation in agriculture and allied sectors.
Applauding the bank’s performance under the Atal Pension Yojana, Nagaraju also encouraged improvement in other financial inclusion schemes such as Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Pradhan Mantri Jan Dhan Yojana (PMJDY). He emphasised the need for staff integration and skill upgradation to strengthen the Karnataka Grameena Bank’s operational capacity post-amalgamation.
