Rural poor devoid of credit

Kathmandu, August 18:

South Asian financial experts, addressing the closing ceremony of a training on ‘Development of Rural Financing institutions and cooperatives’ here today, have shown concerns over the increasing rural poor in South Asia. “Rural poor are devoid of credit which has created difficulties in the region to move forward in reducing poverty,” they voiced.

Participants from India, Maldives, Sri Lanka, Bhutan and Nepal opined that there was an urgent need to strengthening micro credit institutions with effective management along with rationalisation of crucial financial issues. L N Bhusal, deputy governor of Nepal Rastra Bank (NRB), one of the organisers, said that the need has arisen to strengthen rural financing and cooperative development in the SAARC region to reduce poverty.

He said that large section of the agriculture dependent rural populace are the dominant factor of our economy. Despite several attempts by the governments to avail the access to rural credit, rural populace has limited access to the institutional credit services. “Existing gap between demand and supply of rural credit demands the better service delivery mechanism and motivation to creditors. The challenge of banking institutions is to help them in providing factual inputs and technical services.”

Prof Dr Bijay K C, chairman of the Agricultural Development Bank Ltd, Nepal (ADB-N), stressed on the need to rationalisation of issues in rural financing and micro credit programmes with close cooperation with South Asian nations. “As we are entering the global market, human resource management is very crucial to cope with emerging challenges,” he said. “Despite increased importance of micro finance and rural financing, it has been neglected, which will not result in sound productivity,” he said adding that micro finance is more than a provisional credit.

Abdul Azeez, a financial expert from Maldives opined that micro finance institutions do play a key role in helping reduce poverty. “If we could share experiences, it would further strengthen our efforts as an effective poverty alleviation tools,” he said. Prof Dr Niranjan Upadhyay, an Indian expert said that if the South Asian countries could share knowledge and experiences in rural financing, it would do wonder for poverty alleviation with sufficient credit mechanisms in the whole South Asian region.