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Submitted by Jayanarayan V P on
In India almost all villages are covered by one SOB or other.Priority sector lending is getting channalized through these Bank Branches.SOBs play a very vital role in Agrecultural Lending in India.Most of the private Sector banks operates in Urban and metro areas in India.We can practiclly conclude that the SOBs are the main source of Finance for small farmers and other artizans working in diffrent occupations in India.Diverting Agrecultural credit for commercial Lending has resulted in the suicide of 17683 farmers.This was due to non availability of credit and exorbitant rate of interst charged by Money lenders in India last year. The Private Sector banks are not interested in Mass banking in India and concentrate only on effluant sections of the populations in the Urban areas. Prior to the financial crisis there was discussions about merging SOBs to create few Big SOBs who can finance huge Infrastructure projects in India.But after the Financial crisis now goverment is in favour of many no of small banks.This can mitigate the risks of Big Scams involving few Big Banks.