A Comprehensive Study of the Credit Delivery Trends and Opportunities in Himachal Pradesh
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Author: Kanika Mehta, Vikalp Sharma, Rajesh Kumar Thakur, Virender Kumar and Harbans Lal
Author Address: Department of Agricultural Economics, Extension Education and Rural Sociology, Chaudhary Sarwan Kumar Himachal Pradesh Krishi Vishvavidyalaya, Palampur-176062 (Himachal Pradesh)and College of Agriculture, Kota Agriculture University, Hindoli-323023 (Raja
Keywords: Agricultural finance, financial inclusion, financial institutions, rural banking.
JEL Codes: G21, G20, Q14, R51.
Abstract
The study delved into the time series analysis of the existing credit delivery mechanisms and their efficacy in reaching rural, semi-urban and urban areas based on the bank statistics in Himachal Pradesh. The findings indicated a positive growth in financial inclusion, with a significant increase in bank branches and deposit figures over the years. However, bank penetration and credit allocation disparities were evident, particularly in rural areas. Public Sector Banks (PSBs) dominated the banking landscape, while private sector banks showed potential in underbanked regions. The Credit-Deposit (CD) ratio had declined, indicating reduced credit issuance against deposits. The agricultural credit allocation remained relatively low, with a decline in agricultural term loans. The study recommended targeted policy interventions to promote financial inclusion by diversifying financial services in underbanked areas, incentivizing private sector banks to expand into remote regions and strengthening credit infrastructure in priority sectors, particularly agriculture.
Description
Indian J Econ Dev, 2024, 20(4), 629-641
https://doi.org/10.35716/IJED-23143