Finance Minister T Harish Rao directed them to return the extra money within a month
Release Date – 11:30 PM, Fri – 23 December 22
file photo
Hyderabad: Finance Minister T Harish Rao has asked bankers to refund the excess interest collected from self-help groups (SHGs) beyond the RBI’s stipulations as well as accrued interest on the excess interest within one month. He also warned them not to charge SHGs for tax collection which is against RBI norms.
On Friday, Harish attended a meeting of the State Bankers Committee (SLBC) at MCR HRD Institute asking banks to charge SHG interest as per RBI norms, i.e. 7% for loans below Rs 3 lakh and 10% for loans below Rs 30 lakhs. Between Rs. 5 lakhs and Rs. 5 lakhs.
The Minister pointed out that certain banks did not implement the revised interest rates, causing unnecessary losses to SHG and the state government. He wants the excess interest charged from SHG to be returned to their account within one month.
Harish noted that SHG is repaying the loan quickly. While the Society for the Eradication of Rural Poverty (SERP) official was handling mobilization, documentation, monitoring and recovery services, he accused banks of charging SHGs Rs 500-5,000 for these services under different names. He wants bankers to submit a detailed report to the state government on this.
He said the Medak DCCB had signed a memorandum of understanding to share a 5 percent interest with village organizers and Mandal Samakhya and Zilla Samakhya who were in charge of mobilization and other services. He suggested that other banks expand similar facilities.
In addition, Harish asked banks to expand support for oil palm cultivation in the state and provide more loans to agriculture and related sectors, as well as education and housing loans.
He also wanted them to extend loans to micro, small and medium enterprises (MSMEs) and approve bridge loans to ensure support on behalf of the state government in this regard.
