Asian Journal of Research in Banking and Finance
Year : 2012, Volume : 2, Issue : 8
First page : ( 67) Last page : ( 82)
Print ISSN : 0000-0000. Online ISSN : 2249-7323.

Priority sector advances of commercial banks - A potential tool for economic development

Dr. Uppal R.K.*, Juneja Amit**

*Principal Investigator, UGC Financed Major Research Project, D.A.V. College, Malout, Punjab

**Research Scholar, Dept. of Economics, Panjab University, Chandigarh

Online published on 7 August, 2012.

Abstract

The concept of priority sector was evolved in the late sixties in order to focus attention on the need to ensure adequate credit facilities to certain neglected sectors of the economy particularly in the rural areas where banks had hardly made their presence felt. The involvement of banks in priority sector lending has grown considerably since then along with the extension of the branch network of banks into the rural areas with special emphasis on opening branches in unbanked areas for the attainment of the socio economic priorities of the government like growth of agriculture, promotion of small entrepreneurs and development of backward area etc. For the analysis of performance in achieving these social targets of banking operations, a study is conducted to compare the relative performance of public sector banks and private sector banks w.r.t. their priority sector advances. The study concludes that Old Private Sector banks are performing much better than nationalized banks, SBI and its associates and new private sector banks as they show much percentage increase in their advances to priority sector on one hand and on the other hand are more successful in achieving their targets in 2011 as compared to other bank groups.

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Keywords

Priority sector advances, Weaker Section, Targets.

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