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RBI to look into progress of financial inclusion

The Reserve Bank of India has said that it plans to look into the progress of the districts in India that come under financial inclusion and the evaluation process will be done by an independent external agency, reported Business Standard, quoting the Reserve Bank of India's deputy governor V Leeladhar.

Mr Leeladhar said that The State Level Bankers’ Committee will pick up one district in each state for 100% financial inclusion. He also said that the central banking body is looking at bringing more districts under financial inclusion.

As part of the plan to bring more districts under financial inclusion, the Reserve Bank of India (RBI) has asked banks to increase the number of no-frill accounts and general purpose credit cards with an upper limit of about INR25,000 in both the rural and semi-urban branches.

Mr Leeladhar added that 50% of the loans through the general credit card can be considered as priority sector lending by banks. He also said that 70-lakh no-frills accounts had been opened by June 2007.

Mr Leeladhar said that at least 68 districts in India have come under RBI’s financial inclusion. He said that, in the not-so-developed areas like the northeast, Bihar, Chhattisgarh and Uttarakhand, RBI representatives have set up working groups to look into the progress of these areas.