Must know concept for NABARD: Brief Introduction of NABARD

By Jyoti Bisht|Updated : July 7th, 2022

You must be having a thousand questions about this apex organization. Today we will discuss the basic information of NABARD. Having stated that, a thorough study of the NABARD Grade A is the key to passing the exam. The NABARD Grade A was thoroughly understood, and a successful preparation plan was created in accordance.

NABARD – National Bank for Agriculture and Rural Development. The committee related to the formation of NABARD - 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) the committee was formed on 30 March 1979, under the chairmanship of Shri B. Sivaraman, a former member of the planning commission, Government of India.  

  • The Committee’s report outlined the need for a new organizational device for providing attention and focus to credit-related issues linked with rural development. Its recommendation was the formation of a unique development financial institution that would address these aspirations and the formation of the 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).
  • NABARD has its headquarters in Mumbai.
  • It was set up with an initial capital of Rs.100 crore, its’ paid-up capital stood at Rs. 5,000 crores as on 31 March 2016.
  • Consequent to the revision in the composition of share capital between the Government of India and RBI, NABARD today is fully owned by the 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.

Board of Directors- NABARD's affairs are governed by a Board of Directors. The Board of Directors is appointed by the Government of India in consonance with NABARD Act. At present Dr. Harsh Kumar Bhanwala is the Chairman of the National Bank for Agriculture and Rural Development (NABARD) since December 18, 2013.

Function of NABARD

In order to promote integrated rural development and prosperity and for matters related thereto, NABARD is an apex development bank authorized to provide and regulate credit and other facilities for the promotion and development of agriculture, small-scale industries, cottage and village industries, handicrafts, and other rural crafts, and other related economic activities in rural areas.

The functions of NABARD can be divided into three heads:

  • Financial Functions
  • Developmental Function
  • Supervisory functions 

Assist cooperative banks and regional rural banks in creating their own development action plans.

In order to better the operations of the Regional Rural Banks, assist the sponsor banks and Regional Rural Banks in signing MoUs with state governments and cooperative banks.

Follow the banks' development action plans as they are being carried out.

Financially support the cooperative, commercial, and regional rural banks' training institutions.

Aid cooperative banks financially in developing better management information systems, computerizing processes, and developing their human resources.

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FAQs

  • NABARD, with its headquarters in Mumbai, With its head office in Mumbai, NABARD also operates 414 District Development Managers who work at the district level, along with 31 Regional Offices spread throughout States and Union Territories, a cell in Srinagar, and 4 Training Establishments in the Northern, Eastern, and Southern regions of India. 

  • Planning and monitoring of credit, coordination with various institutions and organizations. It helps the GoI, RBI, and state governments formulate policies on issues relating to rural development and agricultural credit. Supporting cooperative banks' and regional rural banks' initiatives for financial inclusion. Focus on promoting microbusinesses and prospects for employment. Building the capacities of staff members at rural financial institutions and members of the boards of credit cooperatives.

  • The National Bank for Agriculture and Rural Development (NABARD), which was founded and is owned by the Indian government, serves as the primary regulatory agency for the nation's rural banking sector. The goal of this bank is to control and give credit to rural areas, which will be a first step in accelerating rural development in the nation.

  • The National Bank for Agriculture and Rural Development, also known as NABARD, offers investment and production loans for a variety of projects and activities aimed at fostering rural development and prosperity. Since this bank serves as the hub or primary source of funding for all of these development projects, it is up to the bank to make sure that the initiatives get the right kind of support and promote.

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