Lead Bank Scheme
About
- On the recommendations of the Nariman committee, the Lead Bank Scheme (LBS) was introduced by the Reserve Bank of India in 1969.
- LBS aims at coordinating the activities of banks, government and other developmental agencies through fora established under the scheme to enhance the flow of credit to priority sectors for inclusive growth and deepening financial inclusion.
- The RBI will designate a commercial bank as Lead Bank in each district.
- The lead bank will act as a leader for coordinating the efforts of all credit institutions in the allotted districts to increase the flow of credit to agriculture, small-scale industries and other economic activities.
Why in News?
- The Reserve Bank of India has issued the draft circular on the revised guidelines for the Lead Bank Scheme (LBS) for public comments.
- The objective of the revised guidelines is to streamline operational aspects and further enhance the effectiveness of the programme, which was first introduced in 1969 for coordinating development activities at the district level.