NABARD Its Functions & Various Schemes for Rural Market

By:-

Namita Mehrotra

Namita Singh

Prashant Mishra

Pappu Yadav

04/11/2023

NABARD MODEL

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 GENESIS AND HISTORICAL BACKGROUND

The Committee to Review Arrangements for Institutional Credit for Agriculture and Rural Development (CRAFICARD) set up by the RBI under the Chairmanship of Shri B Sivaraman in its report submitted to Governor, Reserve Bank of India on November 28, 1979 recommended the establishment of NABARD. The Parliament through the Act 61 of 81, approved its setting up.

OverviewGovernment of India setup the National Bank for

Agriculture and Rural Development (NABARD) on July 12,1982 to act as an agency for promoting integrated rural development and to provide all sort of production and investment credit for agriculture and rural development.

With a capital base of Rs 2,000 crore provided by the Government of India and Reserve Bank of India .

It operates through its head office at Mumbai, with 28 regional offices situated in state capitals and 391 district offices at districts. 

It is an apex institution handling matters concerning policy, planning and operations in the field of credit for agriculture and for other economic and developmental activities in rural areas.

Essentially, it is a refinancing agency for financial institutions offering production credit and investment credit for promoting agriculture and developmental activities in rural areas.

 NABARD is entrusted with

Providing refinance to lending institutions in rural areas

Bringing about or promoting institutional development and

Evaluating, monitoring and inspecting the client banks

Mission and Vision of NABARD

MissionPromoting sustainable and equitable agriculture

and rural development through effective credit support, related services, institution building and other innovative initiatives.

Vision• Empowerment of rural poor by

improving their access to the formal credit system through various MF innovations in a cost effective and sustainable manner

NABARD and Micro finance

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INFLUENCING POLICIES

NABARD

INVOLVING INSTITUTION

CREDIT SUPPORT

TECHNICALSUPPORT

ENCOURAGING INNOVATIONS

MOTIVATING PARTERNERS

COORDINATION WITH PARTNERS

GROUP FORMATION

TRANNING AND CAPACITY BUILDING

GROUP LINKAGE

NABARD focuses its activities on:-Credit functions:- involving preparation of potential-

linked credit plans annually for all districts of the country for identification of credit potential, monitoring the flow of ground level rural credit, issuing policy and operational guidelines to rural financing institutions and providing credit facilities to eligible institutions under various programmes .

Development functions:- concerning reinforcement of the credit functions and making credit more productive.

 Supervisory functions:- ensuring the proper functioning of cooperative banks and regional rural banks 

 

                  

 Pivotal roleActs as a coordinator in the operations of rural credit

institutionsExtends assistance to the government, the Reserve Bank

of India and other organizations in matters relating to rural development

Offers training and research facilities for banks, cooperatives and organizations working in the field of rural development

Helps the state governments in reaching their targets of providing assistance to eligible institutions in agriculture and rural development

Acts as regulator for cooperative banks and RRBs

NABARD today Initiates measures toward institution-building for improving

absorptive capacity of the credit delivery system, including monitoring, formulation of rehabilitation schemes, restructuring of credit institutions, training of personnel, etc. 

Prepares, on annual basis, rural credit plans for all the districts in the country. These plans form the base for annual credit plans of all rural financial institutions .

It supports State Governments in creation of infrastructure.

Coordinates the rural financing activities of all the institutions engaged in developmental work at the field level and maintains liaison with the government of India , State governments, the Reserve Bank of India and other national level institutions concerned with policy formulation.

Undertakes monitoring and evaluation of projects refinanced by it .

Promotes research in the fields of rural banking, agriculture and rural development.

 Functions as a regulatory authority, supervising, monitoring and guiding cooperative banks and regional rural banks.

RoleandFunctions NABARD is an apex institution accredited with all

matters concerning policy, planning and operations in the field of credit for agriculture and other economic activities in rural areas.  

It is an apex refinancing agency for the institutions providing investment and production credit for promoting the various developmental activities in rural areas .

It undertakes monitoring and evaluation of projects refinanced by it. 

Cont……..It takes measures towards institution building for

improving absorptive capacity of the credit delivery system, including monitoring, formulation of rehabilitation schemes, restructuring of credit institutions, training of personnel, etc.

 It co-ordinates the rural financing activities of all the institutions engaged in developmental work at the field level and maintains liaison with Government of India, State Governments, Reserve Bank of India and other national level institutions concerned with policy formulation.

Cont…….It prepares, on annual basis, rural credit

plans for all districts in the country; these plans form the base for annual credit plans of all rural financial institutions.

It promotes research in the fields of rural banking, agriculture and rural development

SchemesRural Non-Farm Sector Schemes

National Bank for Agriculture and Rural Development (Nabard) has introduced a refinance scheme for regional rural banks, State and district central cooperative banks, urban cooperative banks and scheduled commercial banks to accelerate the pace of construction of quality warehousing facilities for agricultural commodities.

The scheme is expected to create around 9 million tonnes of additional storage capacity in the country

Investment CreditNABARD provides refinance under

Investment Credit to eligible banks for a wide spectrum of manufacturing, processing and service sector activities under Rural Non-Farm Sector. The various refinance schemes of NABARD, inter-alia, cover the entire manufacturing, processing and approved service activities in the SSI sector with emphasis on Cottage, Village, Tiny Industries, Rural Artisans and Rural Crafts

Refinance Schemes for banks under Non-Farm Sector

Refinance to banks will be provided under:Automatic Refinance Facility (ARF), without

submission of schemes/ projects for prior sanction by NABARD up to a prescribed level, an

Pre-sanction procedure i.e., the banks will have to submit scheme/project proposals to NABARD and get them sanctioned before disbursement of loans to their borrower clients

Special Project under Swaranjayanti Gram Swarojgar Yojna (SGSY) on Livelihood Based Development  in Sultanpur District, Uttar PradeshGovt of India , Ministry of Rural Development has sanctioned a Special Project under Swarnjayanti Gram Swarozgar Yojana (SGSY) on Livelihood Based Development for 11,500 BPL families in Sultanpur district, Uttar Pradesh. The total approved cost of the project is Rs.1497.36 lakh

PILOT PROJECT FOR INTEGRATED

DEVELOPMENT OF BACKWAR  BLOCKS (PPID)The objective of the PPID is comprehensive 

development of the selected backward blocks in an integrated manner which would include economic development, infrastructure development and other aspects of human development i.e., education, health, drinking water supply, et

Scheme for setting up of Agriclinic and Agribusiness centres

For setting up agriclinics and agribusiness centres by agriculture graduates has been launched by GoI with the support of NABARD. These centres will provide a package of input facilities, consultancy and other services. They will strengthen transfer of technology and extension services and also provide self employment opportunities to technically trained persons.

Rural Haat Scheme

NABARD has, decided to support Rural Haats in all districts for development of infrastructural facilities in the existing/ new haats by providing grant assistance @ 90% of the total project cost with an upper limit of Rs.5 lakh per haat for minimum infrastructural facilities in the form of raised platforms with semi-permanent roofing, sanitation arrangements, provision of drinking water, compound wall/barbed wire fencing, parking, notice board etc. 

SCHEME OF PROVIDING TECHNOLOGY SUPPORT TO NGOs

Grant Assistance up to Rs.50,000

Purchase of PC

NGO should have completed 3 years

Should have promoted minimum 500 SHGs

Should not have been black-listed

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Innovative Projects

Setting up of grain banksProject on processers cardsProject on e-gramaJoint Liability GroupsSetting up of computer munshisMicro enterprise promotion by SHGs

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NABARD and its Role in Training

• National Bank Staff College, Lucknow .

• National Bank Training Centre, Lucknow.

•  Zonal Training Centre, Hyderabad.•  Regional Training Centre, Mangalore.• Regional Training Centre, Bolpur.• Bankers Institute of Rural

Development (BIRD), Lucknow.

 SUBSIDIARYNABARD Consultancy Services

(Nabcons) is a wholly owned subsidiary promoted by National Bank for Agriculture and Rural Development (NABARD) and is engaged in providing consultancy in all spheres of agriculture, rural development and allied areas

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