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Home / Noida / Gautam Budh Nagar DM warns banks having credit-debit ratio below 40%, asks them to improve it

Gautam Budh Nagar DM warns banks having credit-debit ratio below 40%, asks them to improve it

noida Updated: Sep 23, 2020, 23:07 IST
HT Correspondent
HT Correspondent

Many banks in Gautam Budh district reported a credit-debit ratio (CDR) of less than 40%, an indication of poor lending. This has prompted the district magistrate (DM) to ask banks to improve credit.

With the relaxation of lockdown norms, the engines of the economy are slowly getting back on track. Many businesses are, however, cash strapped with the 68-day lockdown and other restrictions.

In the district level review committee (DLRC), meeting on Tuesday, DM Suhas LY asked banks to speed up their processes.

He said that out of the 47 banks in the GB Nagar district, 14 had a CDR below 40%. The DM will to the banks’ regional offices to increase it up to 60%.

“At present, the overall CDR of the district is 58.44%. It was also found during the DLRC meeting that out of stipulated loan disbursement target of ₹10,600 crore for the fiscal 2020-21, the banks in the district have disbursed ₹2,908 crore of loans till June 2020, which is 27.43% of the target. Out of this ₹2,908 crore, the banks disbursed ₹510.98 crore among 6,535 beneficiaries, under the centre-sponsored ‘Atmanirbhar Bharat’ scheme,” he said.

The DM also said that at present, 650 housing loans in the district have been found non-profitable assets (NPAs). “The overall worth of these housing loans is ₹104 crore,” said Suhas.

Meanwhile, the lead bank manager (LBM) in the district, Ved Ratna, said that GB Nagar has over 450 branches of 47 banks. “CDR below 40% means that out of every ₹100 that a bank raises as deposits, it lends less than ₹40 – besides compulsorily parking ₹24 in government’s statutory liquidity ratio (SLR) and ₹6 as cash reserve ratio (CRR) with the RBI. The highest permissible limit of CDR is 70%,” he said.

The lead bank scheme involves a bank assuming a leadership role for coordinating the efforts of the credit institutions and the Government. Gautam Budh Nagar’s lead bank is Syndicate Bank that appointed Ratna as the LBM.

The reason for a low CDR could be two fold, Ratna explained. One, it could be that the deposits have increased, or that advances have actually not increased.

“Here deposit and advances both are in increasing order but deposit increases more than advances,” he said.

The LBM further said that free training for unemployed persons aging between 18 and 40 years have been started in the district from September 21 at Canara Bank Rural Self Employment Training Institute (CBRSETI) in Surajpur. “The training sessions, which were running continuously before the Covid-19 outbreak, have been started again,” he said.

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