RBI Announces Revamp of Lead Bank Scheme
With reference to deliberation on the recommendations of the Committee of Executive Directors’ with various stakeholders and based on their feedback, the Reserve Bank of India recently decided that the following ‘action points’ will be implemented by the State Level Bankers’ Committee (SLBC) Convener Banks/Lead Banks-
- SLBC meetings should primarily focus on policy issues with participation of only the senior functionaries of the banks/ Government Departments. All routine issues may be delegated to sub-committee(s) of the SLBC. A Steering Sub-committee may be constituted in the SLBC to deliberate on agenda proposals from different stakeholders and finalise a compact agenda for the SLBC meetings. Typically, the Sub-Committee could consist of SLBC Convenor, Reserve Bank of India (RBI) and National Bank for Agriculture and Rural Development (NABARD) representatives and senior State Government representative from the concerned department, such as, Finance/Institutional Finance and two to three banks having major presence. Other issue-specific sub-committees may be constituted as required.
- In cases where the Managing Director/ Chief Executive Officer/ Executive Director of the SLBC Convenor Bank is unable to attend SLBC Meetings, the Regional Director of the Reserve Bank shall co-chair the meetings along with the Additional Chief Secretary/ Development Commissioner of the State concerned.
- The corporate business targets for branches, blocks, districts and states may be aligned with the Annual Credit Plans (ACP) under the Lead Bank Scheme to ensure better implementation. The Controlling Offices of the banks in each state should synchronise their internal business plans with the ACP under Lead Bank Scheme.
- At present, discussions at the Quarterly Meetings of the various LBS fora namely, State Level Bankers’ Committee (SLBC), District level Consultative Committee (DCC) and Block Level Bankers’ Committee (BLBC) primarily focuses on the performance of banks in the disbursement of loans with regard to the allocated target under the Annual Credit Plan. The integrity and timeliness of the data submitted by banks for the purpose has been an issue as a significant portion of this data is manually compiled and entered into the Data Management Systems of the SLBC Convener Banks. The extent to which this data corresponds with the data present in the Core Banking Solution (CBS) of the respective banks also varies significantly. Therefore, there is need for a standardised system to be developed on the website maintained by each SLBC to enable uploading and downloading of the data pertaining to the Block, District as well as the State. The relevant data must also be directly downloadable from the CBS and/ or Management Information System (MIS) of the banks with a view to keeping manual intervention to a minimal level in the process. Necessary modifications may be made on the SLBC websites and to the CBS and MIS systems of all banks to implement the envisaged data flow mechanism.
- To strengthen the BLBC forum which operates at the base level of the Lead Bank Scheme, it is necessary that all branch managers attend BLBC meetings and enrich the discussions with their valuable inputs. Controlling Heads of banks may also attend a few of the BLBC meetings selectively.
- Rural Self Employment Training Institutes (RSETIs) should be more actively involved and monitored at various fora of LBS particularly at the DCC level. Focus should be on development of skills to enhance the credit absorption capacity in the area and renewing the training programs towards sustainable micro enterprises. RSETIs should design specific programs for each district/ block, keeping in view the skill mapping and the potential of the region for necessary skill training and skill up gradation of the rural youth in the district.