New Delhi: In order to provide banking facilities to the rural and far flung areas of the country, the Centre has instructed the public as well as private sector banks to devise a three-year plan to set up branches in the villages. In an effort to ensure the early start of the project, the approval of Board of Directors has been made mandatory.

The Finance Ministry has directed all the banks to take approval on the three-year financial inclusion programme by end of the current fiscal. They were also instructed to inform the Ministry in this regard.
Once the board gives its approval on it, the banks will be more responsible for implementing the same.
On being asked about delay in setting up branches in rural areas, banks are making excuse for not getting nod from the board in this regard.

As per the direction, bank will give proposal to the board. It will feature the three-year detailed programme such as the number of branches to be opened in the rural areas. It will also feature the number of accounts to be opened, the number of Kisan Credit Cards to be distributed to the farmers as well as the number of banking correspondents to be appointed in the rural areas.

The government believes that the entire exercise will provide banking facility to the 80 percent villages in the country by 2014-15.

As of now, 70,000 villages having population of 2000 are being linked with the banking service facilities. Despite successful completion of the plan by March, 2012, 1.11 lakh villages out of 6 lakh will have banking facilities.

Bank branches are being set up in 30, 000 villages, while banking correspondents are being appointed in rest of the villages.

Finance Ministry sources said 1 lakh villages having a population of 1,000 will be linked with banking facility during first phase under the new programme.

The banking service may be provided in 1.35 lakh villages by the next year. Similarly, banking service will reach to the 65 percent population in the country by March, 2013.

Earlier Dainik Jagran had published that the extension of banking service in the rural areas was facing hurdle due to financial crunch.