INDIA: State Bank To Up Rural Presence Through Facilitators

AHMEDABAD, Gujarat (Business Standard), October 20, 2007: The State Bank of India (SBI), which launched two new products in recent days, the SBI Reverse Mortgage Loan for Senior Citizens and the SBI Home Cash in Gujarat, is now looking to further consolidate its presence in rural areas through the business facilitator and business correspondent model which enables greater financial inclusion and outreach to Gujarat by the end of the year. Banks are permitted the use of non-governmental organisations as intermediaries in providing financial and banking services. A business facilitator can identify borrowers, collection and preliminary processing of loan applications, marketing products, follow-up for recovery among other jobs whereas a business correspondent can undertake activities like disbursal of small value credit, recovery of principal/collection of interest, collection of small value deposits among others. SBI Reverse Mortgage Loan allows senior citizens to mortgage their residential property and take a loan of Rs 300,000 to Rs 10,000,000 at a fixed rate of interest of 10.50 per cent, with a reset clause every five years. By Archana Mohan Business Standard Ltd. Copyright