VIJAYAWADA: Chief Minister N Chandrababu Naidu has asked the bankers to study the reasons for currency shortage and evolve an action plan to solve the problem. When the bankers replied to him saying a sharp decline in the number of deposits is the main cause of the crisis, the Chief Minister said the people should not be afraid as deposits will be converted into equity if a bank collapses.
Fearing that the cash crunch may lead to barter system, he said, "We hear that in Madhya Pradesh such a system is in existence. No wonder if it spreads to other parts of the country if the Reserve Bank of India (RBI) fails to deal with cash crunch effectively," he said.
Observing that the banking system is losing people's confidence due to various financial scams, Chief Minister N Chandrababu Naidu sought to know what precautionary measures the RBI is taking to reverse the trend.
Addressing a State-level Bankers' Committee (SLBC) meeting at the Grievance Hall at his residence in Undavalli, near here, Thursday, the Chief Minister expressed concern that the people may no longer come forward to deposit their money in the banks if the customer service fails to improve.
He said the bankers should cooperate in the implementation of distribution of pension in cash and several other welfare programmes.
The Chief Minister said the bankers should take the initiative to achieve 100 per cent target in distribution of agricultural loans as against 49 per cent last year. He said a committee should be formed with the officials of agriculture, revenue, SERP, SLBC and Nabard officials to protect the interests of tenant farmers.
The Chief Minister said the State is doing everything to boost the agriculture sector by providing financial assistance to farmers. Agriculture-related loans are vital for the sector's growth. "We are providing micro nutrients, water, subsidies and other facilities required by farmers to achieve good yields. But, in order for them to work hard, they need timely financial assistance," he said.
In the context of decreasing digital transactions, the Chief Minister asked the officials to evolve a comprehensive policy with incentives for using a digital medium. "I am going in for a massive digitisation in the State. Through Land Hub, Peoples' Hub, CFMS and many other initiatives, the AP government will undergo a digital transformation. The bankers should cooperate," he said.
Speaking on the occasion, Finance Minister Yanamala Ramakrishnudu said demonetisation had created a negative impact on the State government and financial transactions are being affected due to cash shortage.
Planning Commission Vice-Chairman Ch Kutumba Rao said bankers should make small denomination currency available at ATMs.
I am going in for a massive digitisation in the State. Through Land Hub, Peoples' Hub, CFMS and many other initiatives, the AP government will undergo a digital transformation. The bankers should cooperate
N Chandrababu Naidu, Chief Minister