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Abstract

The Reserve Bank of India (RBI) has taken several initiatives in recent years to include all households under the ambit of the formal financial sector. As a step towards this goal, the RBI has directed commercial banks to provide no frills accounts that allow an individual to open a bank account at zero balance. Several initiatives have also been taken to bring households within the scope of institutional credit and take them out of the clutches of moneylenders. The introduction of Kisan Credit Cards (KCC) and General Purpose Credit Cards (GCC) are two notable examples. The present paper investigates credit availability in the district of Hooghly, West Bengal, and found that the penetration of institutional credit is minimal. The moneylenders often play an important role in provision of credit in the district. It is found that a good proportion of demand for both institutional and non-institutional credit comes from lower income households and is thus need-based. The underprivileged sections of the society are the principal takers of credit.

Keywords

institutional credit inclusive growth moneylenders no frills accounts Reserve Bank of India

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Institutional and Non-Institutional Credit Delivery in Hooghly,West Bengal

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