There is a big opportunity knocking at the door of urban cooperative banks but sadly only a few of them are able to use it to their advantage. The matter relates to Pradhan Mantri Awas Yojana (PMAY) in which the govt aims “Housing for All” by 2020 and is busy enlisting agencies to carry out the job.
“Of the 1574 Urban Cooperative Banks (UCBs) across the country only 24 UCBs have entered into MoUs with Central Nodal Agencies under PMAY – the mission of Prime Minister Narendra Modi to replace all temporary (Kutchcha) houses from Indian villages”, says Nafcub-the apex body of urban co-op banks in the country.
Under the PMAY, houses of 300 sq ft are provided to those who are from Economically Weaker Sections of society (EWS) and Low Income Group (LIG) families. The central government will also give a loan to these families at subsidized rate of 6.5 per cent up to Rs 6 lakh.
UCBs being local banks have easy access to the common people and can easily meet the credit need for housing purpose. The share of UCBs for housing loans under priority sector advances toward the weaker sections has also improved considerably during the past few years but it has a good chance under the current scheme.
As the name suggests majority of UCBs are located in urban and semi urban Centres and are pioneer in meeting the Credit needs of their members belonging to poor and marginalized sections of society. There are grassroots level institutions working on the principle of cooperation, claims NAFCUB.
Some of the governmental guidelines especially those relating to technology and finance are proving a stumbling block to the urban cooperative banking sector. Chief Executive of NAFCUB Subhas Gupta advocates relaxation on this front so that more and more UCBs are able to meet the criteria.
Voicing these points, the apex body of Urban Cooperative Banks and Credit Society NAFCUB wrote a letter to the secretary of Ministry of Housing & Poverty Alleviation advocating a greater participation.
UCBs amongst others are one of the Primary Leading Institutions under the Pradhan Mantri Awas Yozana (PMAY)- Credit Linked Subsidy Scheme (CLSS) to provide credit catering to the housing needs of Economical Weaker Section, Lower Income Group, Middle Income Group of the society, it reminds the Secretary.
NAFCUB is yet to receive a reply, confirmed its Chief Executive Subhas Gupta on phone.