Tremendous growth in Northern banking sector :

Access to credit, key to development - CB Governor

Charumini de Silva in Jaffna

Northern development

* Central Bank to provide Rs. 1 billion in loans for Northern province

* Seminars to provide guidance in all sectors

* Applications to the tune of over Rs. 600 million received

Central Bank Governor, Ajith Nivard Cabraal said that access to credit is a key factor for development. Banks should be set up in the Northern province as soon as possible and credit provided to the public to continue their regular activities. There is tremendous growth in the banking sector and the interest shown by the banks to set up branches in the Northern province is also commendable.

He was speaking at the Business Forum Meeting at the Jaffna Municipal Council on Monday.

The Governor said that the Central Bank would provide Rs 1 billion this month for all banks in the Northern province for the purpose of lending.

Internally Displaced People (IDPs) will be given zero interest rate loans and those who default their loans will be given a special low interest rate.

Lending is important, as these people have to re-build their livelihood. “We need to encourage people in the area to launch enterprises and develop their business.

The temporary identity cards, which have been issued by the Ministry of Defence (MOD) should be accepted to approve the loans till the IDPs receive their National Identity Cards as it is important to lend and encourage them to continue their day-to-day activities,” he said.

He said the Central Bank will conduct seminars to provide guidance to improve their business in agriculture, fisheries, livestock, self-employment, credit management, risk management and the other areas that the investors need. When the money is disbursed soon they could benefit and will continue the development momentum.

The provincial branch will be set up in Kilinochchi, which is in the centre, and it is important that all Bankers too agree with the location.

It is essential to show an interest in assisting the people to re-build their livelihood so that they will feel the real impact of one country, Cabraal said.

People’s Bank Assistant General Manager, Northern Zone T. K. Anandaraja said that they have received applications to the tune of over Rs 600 million for lending and the bank has disbursed more than Rs. 280 million.

Over Rs 61 million has been given for agriculture, Rs. 60 million for livestock, Rs. 11 million for fisheries and Rs. 45 million for self-employment projects.

The People’s Bank is the only bank, which has distributed the highest number of loans to the public in the Northern province following its liberation. Foreign remittances have also increased with the dawn of peace, he said.