A familiar script will play out in a few days when Oriental Bank of Commerce inaugurates its branch in Finance Minister Pranab Mukherjee's constituency Jangipur, the 22nd bank branch here since 2008 when Mukherjee took charge as FM.
Here's how it will go: The minister will inaugurate the 1,800 sq ft branch, he will deliver a speech glorifying the government's financial inclusion agenda, advise the audience to repay loans - unlike his colleague in the 80s who threw away funds in 'loan melas' - and bank executives will highlight how they plan to help transform the local economy. But one thing that would not be discussed is how 'business-less' this branch may remain for months, or even years.
Jangipur, a district sub-division of 18 lakh people and an economy driven by wages from bidi rolling, has become the cynosure of bankers with over 20 bank branches inaugurated here since late 2008, but there is hardly any business for most of them. UCO Bank, which inaugurated a branch in January 2010, has managed business of Rs 3.75 crore so far. Union Bank, during its one-and-half-year stay, has clocked business of Rs 3 crore.
"The new industries are yet to make an impact insofar as overall economic development is concerned. So, it becomes difficult for new branches to make a mark while the old branches are doing well," says Anjan Sarkar, senior branch manager with Bangiya Gramin Vikas Bank, a regional rural bank with a dozen branches in Jangipur.
Even as state-run banks wait for business, the rural bank and microfinance institutions are doing very well, owing to the peculiar economic profile of the constituency. Bangiya Gramin Vikas Bank, which has been operating in the town since 1976, sees transactions worth 44 crore a year, compared with just Rs two to three crore for public sector banks.
While the rest of the country is starved of institutions that would promote financial inclusion, in Jangipur municipality area, it is a problem of plenty.
Most Bank Branches Unviable
"It is the duty of any politician to usher in development agencies in his constituency," says KC Varghese, former chairman of Union Bank of India. "And when such agencies go there, it's their duty to contribute with the financial power they have in their hands. They should create and expand the market by financing economic activities."
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