An Analysis of Weaker Sections Lending by Commercial Banks in India

International Journal of Economics and Management Studies

© 2019 by SSRG - IJEMS Journal

Volume 6 Issue 6

Year of Publication : 2019

Authors : Dr. Satish Soni , Provinder Kumar

10.14445/23939125/IJEMS-V6I6P108

How to Cite?

Dr. Satish Soni , Provinder Kumar, "An Analysis of Weaker Sections Lending by Commercial Banks in India," SSRG International Journal of Economics and Management Studies, vol. 6,  no. 6, pp. 46-52, 2019. Crossref, https://doi.org/10.14445/23939125/IJEMS-V6I6P108

Abstract:

The objective of the research paper is to explore the present trends of weaker sections lending by commercial banks i.e. public and private sector banks in India from the year 2004 to 2017. The objectives are; to analyze the growth, lending targets and disparities in weaker sections lending and to find out the significant relationship and degree of association between weaker sections lending of commercial banks. To examine the statistical relationship between two banks groups, various methods such as the exponential growth rate, co-efficient of variation, t-test and co-efficient of correlation has been applied. The trends implied that, the advances made to weaker sections by private sector banks registered a higher rate of growth vis-à-vis public sector banks, during the both phases of the study. It was also found that, on an average, the prescribed target (10.00 per cent of NBC) of weaker section credit was not achieved by public as well as private sector banks during the first and second phase respectively. Although, on an average, the prescribed target of credit to weaker section has not been achieved, but, one important issue of concern is the almost stagnant share of weaker section credit in net bank credit over a period of time by both the public and private sector banks, which needs immediate attention of the policy makers. However, public sector banks in one year and private sector banks in none of the years achieved the prescribed target of lending to agriculture (10.00 per cent of net bank credit). The inter-year disparities with respect to weaker section credit in case of private sector banks are found to be higher as compared to public sector banks in both the phases.

Keywords:

NBC (Net Bank Credit), Weaker Sections, Commercial Banks, Growth Rate, Disparities and Co-efficient of Variation.

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