Chennai: Banks are finding new avenues to increase their presence and market share and Indian Bank one of the premier public sector banks based at Chennai has embarked on a journey to issue a massive 5 lakh no-frills accounts this year. This major initiative by the bank is specially targeted to increase its presence in rural areas.

The whole idea is to promote banking habits among the poorer sections of Indian society, both in rural and urban areas and try to get them into the mainstream banking sector. People will be encouraged to save and use banking infrastructure to promote their small business ventures with this effort.

CMD of Indian Bank M S Sundara Rajan said, “There is plenty of hidden potential in rural areas and financial inclusion initiatives have helped the bank double its business growth from rural and semi-urban areas.” The bank is expected to achieve its targets pretty easily as it has already opened 4.5 lakh such accounts.

Earlier, Cuddalore District had been declared the first District in Tamilnadu to have been fully covered under Banking Services. A function was organised at Cuddalore by Indian Bank, Lead Bank for the District on 5th October 2007 to commemorate the availing of Banking Services by the entire Cuddalore District. “Financial Inclusion Project” with an objective of extension of Banking Services by way of opening “No Frills accounts” with “Nil” or very low minimum balance to all the willing eligible persons in the District was launched on 11.07.2006 in the District.

All Bank branches conducted household survey in the entire District and 2.75 lakh new accounts were opened in the last one year. 1057 beneficiaries were issued with General Credit card by which they are entitled to avail a loan ranging from Rs.5000/- - Rs.25000/- Overdraft ranging from Rs.1000/- - Rs.5,000/- has been allowed to 10098 No Frill account holders.

The Reserve Bank of India (RBI), apex banking regulator in India had earlier directed the banks to offer basic banking account with zero or low minimum balance requirements so that a greater number of people from the less privileged section of the society are brought into banking fold. Such 'no-frills' accounts have recently caught the attention of many banks and Indian Bank seems to be doing its bit in tandem with RBI's guidelines.