The National Bank for Agriculture and Rural Development, or Nabard, is set to change its business model by funding infrastructure projects in the power and agricultural sectors on a commercial basis and expanding its role in financing state-government sponsored projects.
The move follows recommendations by the Boston Consulting Group (BCG), the mandated adviser for Nabard’s business restructuring plan, and will mark the entry of the organization into commercial infrastructure funding for the first time since in its inception in 1982.
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Interview with Umesh Chandra Sarangi, Chairman, Nabard
State-run National Bank for Agriculture & Rural Development (Nabard) has launched a repositioning exercise. Umesh Chandra Sarangi, its chairman, talks to Sanjay Jog on the challenges and opportunities.:
How is Nabard positioned after RBI’s equity was transferred to the government of India? Critics say it has become an extended arm of the government.
The position of Nabard as a development finance institution remains unchanged. The shares were transferred to the government, respecting the basic principle that a regulator cannot be the owner. Read more on Business Standard
Nabard awaits Malegam report on MFIs
The National Bank for Agriculture and Rural Development (Nabard) would target smaller microfinance institutions (MFIs) and put a cap of 25 per cent interest rate once the YH Malegam committee report is out, said KG Karmakar, managing director, Nabard.
“MFIs are only growing in over-banked areas. We want to focus more on these poverty-ridden areas, where the banking sector is not very strong. We are working out on a proposal to put a cap on interest rate at 25 per cent but would allow up to 30 per cent in some places like hilly and small poverty-ridden areas,” he said . Read more on Business Standard