As lending to the priority sector is a good business, the Reserve Bank of India is set to revamp the State-Level Bankers` Committees (SLBC) to enable more lending to agriculture and small and micro enterprises, its Deputy Governor S.S. Mundra said on Saturday.

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"We are looking at revamping the entire structure of SLBC so that banks can lend more to the priority sector, which has the potential to create more jobs and self-employment," said Mundra at a conference organised by the College of Agricultural Banking here.

Addressing bankers from across the country on `Priority Sector Lending - Status, Issues and Future Agenda`, he said a project was underway in the central bank to extract data directly from
banks` core banking system and help them use it for credit planning.

"The project is at an advanced stage. Once it is implemented, banks can use the data, apply analytics and prepare the right lending strategy," he said.

Noting that many agencies were involved in the priority sector lending, Mundra said in the SLBC structure, the lead bank offices at district level prepare ae District Credit Plan and then, National Bank for Agriculture and Rural Development (Nabard) prepares the Potential Linked Credit Plan, which the SLBC adopts and distributes among all banks.

"I have a suspicion that between the overall priority sector strategy and what happens at the SLBC and DCP level, there may not necessarily be any logical linkage," he said.

Admitting that excessive lending to corporate sector was the result of "least input and maximum output", Mundra said though large credit volumes could be created with little effort, similar volumes in the priority sector would require large resources in terms of branch staff.

"Loans to priority segments like agriculture and SMEs support economic activities, generate income and surplus. Such borrowers also become worthy recipients of retail credit. Moving over to priority sector makes business sense," he said.

Noting that in public sector banks, the priority sector`s responsibility is spread across the rural credit, MSMEs and affordable housing verticals, Mundra noted that he was not sure whether they make any coordinated effort for a comprehensive strategy.

He called for verticals to come together as a cohesive group, prepare strategy and take it to the board for broader discussion and guidance, he said, stressing priority sector activity should not remain confined to being mere data collection.