The document summarizes the origins and functions of the National Bank for Agriculture and Rural Development (NABARD) in India. It was established in 1982 to provide credit and other support services to promote rural and agricultural development. Key points include that NABARD provides refinancing to rural banks, coordinates rural development programs, and promotes initiatives like microfinance and support for farmers through training centers.

1. Bank for Agriculture and Rural
Development
NABARD

2. Genesis
• Reserve Bank of India (RBI), constituted a
committee to review the arrangements for
institutional credit for agriculture and rural
development on 30 March 1979.
• Purpose was to review the arrangements for
institutional credit for agriculture and rural
development.

3. • The Committee felt the need for a new
organisational device for providing undivided
attention and focus to the credit problems
arising out of integrated rural development.
• It recommended the formation of National
Bank for Agriculture and Rural
Development(NABARD).

4. • The Parliament, through Act,61 of 1981,
approved the setting up of NABARD.
• The bank came into existence on 12 July 1982
by transferring the agricultural credit
functions of RBI and refinance functions of the
then Agricultural Refinance and Development
Corporation (ARDC)

5. Functions of NABARD
I. Financial
II. Development
III. Supervisory

6. I Financial Function of NABARD
• Refinance
• Direct Finance

7. Refinance
• Department of Refinance provides refinance
in respect of term loan for both Farm Sector
and Non - Farm Sector activities.
• Short term loans available for a period of 12
months
• Long term loans are available for a period of 3-
15 years.
• It is released to only eligible institutions

8. Institutions Eligible for Refinance
• State Co-operative Agriculture & Rural Development
Banks (SCARDBs)
• Regional Rural Banks (RRBs)
• State Co-operative Banks (SCBs)
• Commercial Banks (CBs)
• State Agricultural Development Finance Companies
(ADFCs)
• Scheduled Primary Urban Co-operative Banks (PUCBs)
• North East Development Finance Corporation (NEDFC)
• Non-Banking Financial Companies (NBFCs)

9. Activities covered by NABARD
Refinance
• Minor Irrigation, Land Development, Dry Land
Farming, Watershed Development, Farm
Mechanisation, Plantation & Horticulture,
Poultry / Dairy / Other Animal Husbandry
Activities, Fisheries, Bio-gas, Forestry,
Storage/Market Yard, Non - Farm Sector (Small
& Micro Enterprises), Self Help Groups,
Financing in Agri Export Zones etc

10. Direct Finance
• Direct Investment of NABARD in projects.
• Example –
1. Punjab State Grain Procurement Corporation
(Construction of Steel silos and related works
at Rampura Phul )
2. Rajasthan State Warehousing Corporation.

11. II Developmental Function
• Farm Sector
• Non-Farm Sector
• Financial Inclusion
• Micro Credit Innovations
• Research and Development
• Core Banking Solutions to Cooperative Banks
• Climate change
• Institutional Development

12. Farm Sector
• Farm Sector Development Department (FSDD)
• Conservation and management of natural
resources
• Accelerating ground level credit flow by Rural
Financial Institutions
• Incremental agricultural production and
productivity
• Generating rural employment and raising the
standard of living of rural poor through credit and
grant.

13. Projects
• Support to Farmers' Training and Rural
Development Centres
• Grant support is provided to Farmers' Training
and Rural Development Centres set up by
major Commercial Banks / other agencies

14. • Support for Capacity Building for Adoption of
Technology (CAT)
• Under Capacity Building for Adoption of
Technology (CAT), during 2013-14, 392
exposure visits were arranged in collaboration
with select research institutes to build the
capacity of around 11736 farmers for
adopting new / innovative methods of
farming.

15. • Areas covered were:
• Precision farming
• High-tech agriculture
• Banana tissue culture
• Fodder development
• Organic farming
• Drum seeding
• Sustainable agriculture practices, cattle
management, vegetable seed multiplication

16. Village Development Programme
• Holistic Development of villages.
• VDPs are implemented by partnering with NGOs
or other agencies.
• Activities such as-
• Comprehensive soil testing and recommended
crop specific package of practices.
• Integrated Nutrient Management (INM) /
Integrated Pest Management (IPM), Organic
Farming, use of certified seeds, Nursery
Development etc

17. • Improved seed replacement, use of low cost
compost/ vermi compost led to reduction in
cost of cultivation from 10 to 20%.
• Pilot Project on Augmenting Productivity of
Lead Crops

18. • Pilot Project on System of Rice Intensification - a
combination of simple agronomic and
management practices to improve productivity.
• Average increase in grain productivity reported at
30%
• In condition of poor rainfall, this method did
comparatively well.
• Cost of cultivation was observed to be reduced
while income level of small and marginal farmers
have increased.

19. Rural Non-Farm Sector Development
• Promotion of Rural Non-Farm Sector to reduce
over dependence on agriculture of our rural
population and to provide alternate livelihood
options.
• Helps in reducing large-scale migration of small
and marginal farmers and agricultural labourers
to urban areas in search of livelihood
opportunities on account of
unemployment/disguised employment in the
agriculture sector.

20. Priority Area
• The focus has been on greater credit flow for
small, cottage and village industries,
handloom, handicrafts and other rural crafts
and service sector rural areas.
• Building an entrepreneurial culture and
necessary skills among the rural youth and
women.
• Developing markets for the rural non-farm
sector.

21. Marketing Initiative
• To enable the artisans to sell the products in
marketing events.
• To market their artistry to the consumers and
benefit directly from the market feedback for
better value realization in future.
• Financial assistance by way of grant is
provided on selective basis.

22. • Example -
• The Bank co-sponsored SARAS-Mahalaxmi
Fair at Mumbai wherein 100 artisans from 27
States participated in the 11 day long
exhibition-cum-sale event.

23. • Participation in marketing events/exhibitions
provided them necessary exposure to interact
directly with the consumers.
• Interface with management students,
professional designers and representatives of
promotional agencies like KVIC/KVIB, etc., at
such events enabled the artisans to fine tune
their product range to suit consumer
preferences.

24. • Example –
• Confederation of Indian Industry (CII) was
sanctioned Rs.9 lakh for experimenting with
marketing of handloom and handicraft
products from the north-eastern States
through organised retail outlets in Metro
Cities.

25. Women Empowerment
• Assistance to Rural Women for Non-Farm
Development (ARWIND) scheme was
introduced in 1993 for meeting promotional
and other credit needs of women
entrepreneurs supported by NGOs, co-
operatives and other registered institutions.

26. • The scheme of Marketing of Non-Farm
Products of Rural Women (MAHIMA) aimed at
supporting agencies engaged in marketing
products manufactured by rural women was
introduced in 1997.

27. Microfinance
• The SHG-Bank Linkage Programme launched
by NABARD in 1992 continues to be the
predominant Micro-Finance (MF) model in the
country.
• It is a proven method of financial inclusion,
providing unbanked rural clientele with access
to formal financial services from the existing
banking infrastructure.

29. SUDHA
• A SHG Bank linkage Program
• ‘Help the women to help themselves’.

30. • A Self-Help Group (SHG) is a village-based
financial intermediary usually composed of
10-20 local women.
• Members make small regular savings
contributions over a few months until there is
enough capital in the group to begin lending.
• Funds may then be lent back to the members
or to others in the village for any purpose

31. • In India, many SHGs are ‘linked’ to banks for
the delivery of micro-credit.