Unwritten rules have DWCRA groups worried

The gunpoint sale of insurance by the bankers has become a cause of concern for the DWCRA groups. The groups are also worried about the bank officials’ unwritten dictum — savings amount should not be withdrawn until the loan amount was cleared.

The Self Help Groups (SHGs) have flagged the issue at various meetings conducted by the Society for Elimination of Rural Poverty (SERP), a nodal agency for the bank linkage. Following which, the SERP conducted a survey and found that the bankers, at a few places, were not allowing the group members to withdraw their savings. It was also observed that the SHG members were not allowed to withdraw the amount deposited towards the ‘pasupu-kumkuma’ scheme (capital infusion), sources say.

According to information, there are more than 7.20 lakh SHG groups in rural areas in the State. The total savings in their accounts are more than ₹5,600 crore. The government recently deposited ₹2,000 crore towards the capital infusion scheme. Prior to that, more than ₹3,000 crore is lying with the banks in savings accounts of the SHGs. Though it is not possible to say how much amount has been withheld by the banks, it could be in the region of ₹250 crore to ₹300 crore going by the fact that close to 25% of the respondents have asserted that the banks were not allowing them to withdraw their savings, says an official.

SERP chief promises action

The SHGs also complained that a few bank officials were pushing insurance policy along with the loan they take. Contrary to the rules, the bank officials were collecting processing charges and inspection charges even for loans up to ₹2.5 lakh, source say.

When contacted, SERP CEO P. Krishna Mohan said, “The problem is seen in banks like Andhra Pradesh Pragati Grameena Bank, Andhra Pradesh Grameena Vikas Bank, Andhra Bank and State Bank of India (SBI). We will write letters to the banks’ higher- ups urging them to take corrective measures.”

The SHG portfolio in A.P. was the best in the country. The loan repayment was very high compared to any other portfolios or any other State, he said.