'NABARD PROJECT 2' U

PROJECT 2
NABARD
(National Bank for Agriculture and Rural development )
Submitted by: Umme Qulsoom

Class: MBA
Domain name : Banking and finance
Introduction to NABARD
The importance of institutional credit in boosting rural economy has

been clear to the Government of India right from its early stages of
planning. Therefore, the Reserve Bank of India (RBI) at the insistence
of the Government of India, constituted a Committee to Review the
Arrangements For Institutional Credit for Agriculture and Rural
Development (CRAFICARD) to look into these very critical aspects.
The Committee was formed on 30 March 1979, under the
Chairmanship of Shri B. Sivaraman, former member of Planning
Commission, Government of India.
The Committeee’s interim report, submitted on 28 November 1979,
outlined the need for a new organisational device for providing
undivided attention, forceful direction and pointed focus to credit
related issues linked with rural development. Its recommendation
was formation of a unique development financial institution which
would address these aspirations and formation of National Bank for
Agriculture and Rural Development (NABARD) was approved by the
Parliament through Act 61 of 1981.
NABARD came into existence on 12 July 1982 by transferring the
agricultural credit functions of RBI and refinance functions of the
then Agricultural Refinance and Development Corporation (ARDC). It
was dedicated to the service of the nation by the late Prime Minister
Smt. Indira Gandhi on 05 November 1982. Set up with an initial
capital of Rs.100 crore, its’ paid up capital stood at Rs.14,080 crore
as on 31 March 2020. Consequent to the revision in the composition
of share capital between Government of India and RBI, NABARD
today is fully owned by Government of India.
Vision
Development Bank of the Nation for Fostering Rural Prosperity.
Mission
Promote sustainable and equitable agriculture and rural

development through participative financial and non-financial
interventions, innovations, technology and institutional development
for securing prosperity.
What we do
NABARD initiatives are aimed at building an empowered and

financially inclusive rural India through specific goal oriented
departments which can be categorized broadly into three heads:
Financial, Developmental and Supervision. Through these initiatives
we touch almost every aspect of rural economy. From providing
refinance support to building rural infrastructure; from preparing
district level credit plans to guiding and motivating the banking
industry in achieving these targets; from supervising Cooperative
Banks and Regional Rural Banks (RRBs) to helping them develop
sound banking practices and onboarding them to the CBS platform;
from designing new development schemes to the implementation of
GoI’s development schemes; from training handicraft artisans to
providing them a marketing platform for selling these articles.
Over the years our initiatives have touched millions of rural lives
across the country. Our milestone achievements have been India’s
achievements as well. The SHG Bank Linkage Project launched by
NABARD in 1992 has blossomed into the world’s largest micro
finance project. Kisan Credit Card, designed by us has become
source of comfort for crores of farmers. We have financed one fifth of
India’s total rural infrastructure. We were pioneers in the field of
watershed development as a tool for sustainable climate proofing.
It’s a long list indeed and we welcome you to understand us better.
Functions of NABARD
The major functions of NABARD include promotion and

development, refinancing, financing, planning, monitoring and
supervision.
1-Non-credit related:
• Credit Planning and Monitoring, Coordination with various
agencies and institutions.
• Assist in policy formulation of GoI, RBI and State Governments
on matters related to agricultural credit and rural development.
• Institutional development and capacity building of
Cooperatives and Regional Rural Banks (RRBs) to strengthen
the rural credit delivery system. Statutory inspection of Regional
Rural Banks (RRBs), State Cooperative Banks and District
Central Cooperative Banks (DCCBs), voluntary inspection of
State Cooperative Agriculture and Rural Development Banks
(SCARDBs) and their off-site surveillance.
• Promotional and developmental initiatives in the areas of farm,
off-farm, micro finance, financial inclusion, Convergence with
Govt sponsored programmes.
• Supporting the financial inclusion efforts of Regional Rural
Banks and Cooperative Banks.
• Thrust on promotion of livelihood opportunities and Micro
Enterprises.
• Capacity Building of Personnel and Board Members of Credit
Cooperatives and Staff of Rural Financial Institutions.
• Support to research and development, rural innovations, etc.
2-Credit related:
• Refinance to Rural Financial Institutions for investment credit
(long term loan) and production and marketing credit (short
term loan) purposes for farm and off-farm activities in rural
areas.
• Loans to State Governments for developing rural infrastructure
and strengthening of the Cooperative Credit Structure
• Loans for warehousing infrastructure to State Governments,
State/ Central government Owned/ assisted entities,
Cooperatives, Federation of cooperatives, Farmers’ Producers
Organizations,(FPOs), Federations of Farmers’ Collectives,
Primary Agricultural Credit Societies (PACS) / Cooperative
Marketing Societies (CMS) or similar institutions, Corporates/
Companies, Individual entrepreneurs, etc.,
• Direct lending to Cooperatives and Producers’ Organization,
support to State owned institutions /corporations under
NABARD Infrastructure Development Assistance and direct
lending to individuals, partnership firms, corporates, NGOs,
MFIs, Farmers’ collectives etc. under Umbrella Programme for
Natural Resource Management (UPNRM)
• Pass through agency of select Government of India Capital
Investment Subsidy Schemes.
Importance of NABARD
NABARD serves as an apex financing agency for the institutions
providing investment and production credit for promoting the various
developmental activities in rural areas.
NABARD is a Development Bank with a mandate for providing and

regulating credit for the development of agriculture, small-scale
industries, cottage and village industries, handicrafts and other allied
economic activities in rural areas to promote prosperity of rural
areas.

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PROJECT 2

Submitted by: Umme Qulsoom

The importance of institutional credit in boosting rural economy has

Development Bank of the Nation for Fostering Rural Prosperity.

Promote sustainable and equitable agriculture and rural

NABARD initiatives are aimed at building an empowered and

The major functions of NABARD include promotion and

NABARD is a Development Bank with a mandate for providing and

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