According to Sri Aditya Puri, Managing Director and Chief Executive of HDFC Bank, the government's financial inclusion agenda is desirable but that should not be discriminatory and lead to unmanageable burden on banks with specified lending targets for the poor.
He said, "we cannot have the haves and have-nots. I think financial inclusion is a political, economical and social necessity. That opening a banking account or giving a loan without creating a repayment capability is not the solution, so please do not have this priority sector targets only for banks."
Prime Minister Manmohan Singh's government has been pushing the 'financial inclusion' agenda to ensure that most citizens of the country have access to financial services. It is adopting various measures including mandating certain targets for banks in a nation where more than half don't have access to banks. But some of the efforts were in vain with a recent RBI report pointing out that no-frills accounts have been inoperative since people don't have enough money in the first place to deposit in banks.
The central bank has mandated that at least 40% of the total loans should be given to farmers, small businessmen, minority community and to individuals for purchase of home or to students to pursue education. However, there is no such mandate to government-owned or even private companies.
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