A recent press report said that United Bank of India has released Rs. 65 crore to three weak regional rural banks (RRB) which is sponsored by the bank for its core banking solution implementation.
As per the government scheme to support weak RRBs, sponsor banks will offer 50% of their CBS cost, National Bank for Agriculture & Rural Development (Nabard) will take up 40% of the bill while the balance will be borne by the weak banks themselves.
Reports said that the government considers the rural banking sector as an important link for the country’s financial inclusion drive. There are 82 RRBs across the country out of which 28 have accumulated losses and are eligible to receive funding support for technology solution. UBI has four RRBs in its fold and three of them namely Bangiya Gramin Bank, Manipur Rural Bank and Tripura Gramin Bank are eligible to get support.
Similarly Assam Gramin Vikas Bank, the fourth rural bank under UBI’s fold, will not get any support under the Nabard scheme as it does not carry accumulated losses. UBI has built a common platform for its RRBs’ technology drive and engaged hardware and tech vendor Hewlett Packard to this endeavor.
UBI has recently hiked its Base rate and BPLR rates by 25 basic points each making its home loan and other loans costlier.