A lop-sided credit-deposit (CD) ratio in Odisha has come as a serious concern for the State Government as it has a direct impact on growth of the State.
Major worry is the CD ratio is falling year after year, while the State Government is stressing on more credit for the people during the Covid-19 pandemic. In the recently held State Level Banker’s Committee (SLBC), the issue came up for discussion, where the State Government officials raised concern over a lower CD ratio. In fact, CD ratio of Odisha is falling and it is quite low 55.79 percent as on June 30 as compared to June 30, 2019 CD ratio which was 62.43 percent. This is in very low in comparison to the national CD ratio of 74 percent.A higher CD ratio is considered good for State economy, as it shows that people are able to utilise the deposited amount with banks in productive works.
While total deposit as on June 2020 was Rs 3,58, 531.33 crore, advance utilised in State is Rs 2,00,034.07 crore. Total deposit as on March 2018 was Rs 2,75,511.08 crore and credit was Rs 1,92,113.66 crore.This speaks volumes that commercial banks are mopping up large chunk of money from the State as deposits.
However, they are not obliging people to reap benefits of credit for which CD ratio is falling year after year. It can be observed that there is an increase of deposit mobilization by bankers to an extent of Rs 41,596.03 crore, where as credit has increased only by Rs 2,167.68 crore for which CD ratio has decreased from 62.43 percent to 55.79 percent with one year.
Only three districts Jharsuguda, Jajpur and Boudh have achieved CD ratio of more than 60 percent, while 12 districts have registered CD ratio below 40 percent.Those districts are Angul, Deogarh, Sambalpur, Kandhamal, Malkangiri, Gajapati, Ganjam, Puri, Kendrapara, Jagatsinghpur, Keonjhar and Mayurbhanj.
Total agriculture advance as on June 30 was only Rs 59,811.08 crore, while Odisha is predominantly an agricultural economy State, where 63 per cent people depend on the primary sector. While cooperative sector banks are extending more credit than their deposits, public sector banks are worst performers. Cooperative Banks are extending credit more with 123.97 percent of their deposits, while public sector banks are extending only 47.35 percent of their deposits.
MSME Sector, which is facing tough time due to Covid-19 pandemic has received cumulative credit of Rs 42,120.85 crore as on June 30, 2020.However, banks are busy in mobilizing more deposits from institutions of State Government.
Officials admit that more than Rs 10,000 crore of funds were parked in banks, which Department of Finance has been taking up with the Drawing Disbursing Officers (DDO) so that these unutilised funds will be utilised in development programmes.
More than Rs 3,500 crore parked funds have been withdrawn and it is being utilised for developmental projects, sources said.