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NABARD Signs MoU with SBI to Take up Joint Intervention Projects in Karnataka

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Nabard SBI ink MoU for livelihood intervention projectsOn December 2, 2020 NABARD( National Bank for Agriculture and Rural Development), Karnataka Regional Office Bengaluru, Karnataka has signed MoU(Memorandum of Understanding) with SBI(State Bank of India), LHO, Bengaluru to provide concessional refinance facility to the beneficiaries of watershed development and tribal development projects.

Aim of the MoU

  • The 2 institutions to take up joint intervention projects in the State.
  • NABARD through this MoU, aims to provide grant support, concessional refinance and undertake capacity building of the stakeholders of various livelihood interventions that is promoted by NABARD.

Key People

Shri Niraj Kumar Verma, CGM(Chief General Manager), NABARD and Shri Abhijit Majumder, CGM, SBI signed the MoU at NABARD, Regional Office, Bengaluru.

About the MoU:

Anticipation to Merge the ongoing Initiatives of NABARD and SBI

i.With this MoU, NABARD and SBI anticipate to associate together to merge their ongoing development initiatives.

ii.This consequently aids the beneficiaries of Tribal Development Fund (TDF), Watershed Development Fund (WDF), Farmer Producer Organisation (FPOs), Self-Help Group (SHGs), Joint Liability Groups (JLGs), etc.

iii.In this regard, this MoU aims to benefit the following:

  • Farmers and 45000 beneficiaries of 260 FPOs in 28 districts, 8500 beneficiaries in 20 districts of 70 watersheds and 15 Tribal Development programmes (wadis) along with (JLGs/ Self -Help Group SHGs.
  • They will be benefited through E- Shakti (digitization)/ Artisans/ Agri-preneurs /Agri Start Ups, etc. in the State.

SBI to Act as Implementation Agency for Digitizing NABARD’s SHGs 

i.This MoU enables SBI to act as an Implementing Agency for digitizing NABARD’s SHGs and to on board NABARD’s E-Shakti portal across Karnataka

ii.This facilitates the availability of credit to the SHGs to promote livelihood.

In addition to this, each branch of SBI in rural and semi-urban areas will seek to finance 50 JLGs and SHGs every year.

Note– Under the E Shakti project of the NABARD, that was launched in  29 districts of Karnataka, in total 3,02,614 SHGs have been digitized and 2,81,755 SHGs are credit linked as on October 1, 2020.

NABARD Extends support to Promote  JLGs

i.NABARD will extend grant support to promote  JLGs.

ii.SBI will explore the possibility of entering into a separate MoU with NABARD to promote JLGs with the support of BC/BF(Business Correspondents / Business Facilitators).

Financial Literacy Programme

NABARD will extend the support at the rate of 60% of Rs 5,000 to conduct the financial literacy programmes in the rural/semi-urban branches and through the FLCs of SBI.

NABARD extends support to Procure infrastructure support

NABARD will extend grant support to procure infrastructure support like VSAT, mobile signal boosters, handheld projectors etc. to SBI.

This move aims at financial inclusion.

Points to be Noted

i.Recently, Dr. Govinda Rajulu(G.R.) Chintala, chairman of NABARD announced Rs. 5000 Cr concessional refinance facility for banks and financial institutions.

ii.This was to provide finance to the beneficiaries of the 3295 watershed development and 791 tribal development projects across the country, over 3 years period from 2020-21 to 2022-23 and digitization of 2 million SHGs by 2021-22.

iii.The MoU signed between SBI and NABARD is in this direction.

Recent Related News:

i.On October 1, 2020 National Bank for Agriculture and Rural Development (NABARD) launched a special refinance scheme to support the government’s Water, Sanitisation and Hygiene (WASH) programme. For this purpose, Rs 800 crore has been earmarked for the financial year 2020-21. This facility is an effort to promote a sustainable and healthy lifestyle in rural areas.

ii.The National Bank for Agriculture and Rural Development (NABARD) has introduced, ‘Structured Finance and Partial Guarantee Program for Non-Banking Finance Companies (NBFC)-Micro Finance Institutions (MFIs)’, a dedicated debt and credit guarantee product to ensure uninterrupted flow of credit to the last mile in rural areas hit by the COVID-19 pandemic.

About National Bank for Agriculture and Rural Development (NABARD):

Came into existence-12 July 1982
Chairman– Dr. Govinda Rajulu(G.R.) Chintala
Headquarters– Mumbai, Maharashtra
NABARD was approved by the Parliament through Act 61 of 1981.

About SBI(State Bank of India):

Founded– July 1, 1955 as SBI
Headquarters– Mumbai, Maharashtra
Chairman–  Dinesh Kumar Khara(Succeeds Rajnish Kumar)
Tagline– The banker to every Indian; With you all the way; Purely banking nothing else; The nation banks on us; A bank of the common man