rural credit, rrb, nabard, mfi

1. Rural Development
Credit and Marketing in Rural Areas

2. CREDIT

3. Rural Credit
• India’s a country of villages, about
50% of the villages have very poor
socio-economic conditions.
• They borrow money to buy
fertilizers, seeds and other
implements.
• Family expenses of marriage,
death, and other religious
ceremonies.

4. Drawbacks
• Exploitation by money lenders.
• Lend money at high rate of interest.
• Do not keep proper accounts.
• Harassment.
• Borrowers find themselves in debt trap.

5. Sources of credit
1%
25%30%
27%
7%
7%
3%
Sources of credit

6. Reforms
• NABARD
• RRB
• Commercial banks
• Cooperative banks
• Micro finance institutions
• Green revolution
• Introduction to subsidies
• Self help groups

7. Regional Rural Banks
• Local level banking organizations.
• Functions:
1. Bank facilities to rural and semi urban areas.
2. Disbursement of wages to MGNREGA workers.
3. Providing para banking facilities.

8. National bank for agriculture and rural development
• Financial institution headquartered at
Mumbai.
• Looks after the development of cottage
industries.
• Serves as an apex financial agency for
providing investment in rural areas.
• Takes measures in credit delivery system.
• Regulates cooperative banks, RRBs etc.

9. Micro finance institution
• Provides financial services to micro- entrepreneurs
and small businesses.
• Gives loans to poor rural people at low interest rate.
• Objectives:
1. Promotes self reliance
2. Empowers women
3. Encourage entrepreneurship
4. Provision of subsidies