Question

Amar is running a village industry of processing of fruits. He took loan from State Bank of India. Even after this loan he is not able to meet his financial requirements. He is now looking for someone who can re-finance his industry of rural area. He should contact which financial institution for this purpose? Identify and explain any three functions of this financial institution.

Answer 1

He should contact NABARD for this purpose.

Functions of NABARD are:

1. NABARD is empowered to undertake inspection of RRBs and Cooperative Banks, other than the Primary Cooperative Banks.

2. To open a new branch, a recommendation of NABARD is imperative by RRBs or Cooperative Banks to seek permission from RBI.

3. RRBs and Cooperative Banks, along with RBI, are required to file returns and documents with NABARD.