Bihars Development Commissioner Reviews Loan Distribution, Warns Underperforming Banks
Bihars Development Commissioner reviews banking performance and loan distribution, urging banks to improve their credit processes.
Patna, October 24 (Daily Kiran) : A high-level committee meeting was held on Friday in Patna, chaired by Development Commissioner Mihir Kumar Singh, to review the performance of banks and the flow of loans in Bihar. The meeting focused on the annual credit plan’s progress, the credit-deposit ratio (CD ratio), and the distribution of loans under various welfare schemes.
A significant highlight of the meeting was the introduction of a scientific measurement index scoring banks out of 100 points. This new system ranks banks based on various performance metrics. Additionally, the state government has expanded the review process by including four new welfare schemes in the loan monitoring mechanism.
For the financial year 2026-27, Bihar’s annual credit plan has been increased to ₹4.95 lakh crore, nearly four times the previous year’s plan size of around ₹1.25 lakh crore. This ambitious target aims to bolster the state’s gross domestic product (GDP) and significantly enhance job creation. By the end of the September quarter, the state achieved a strong loan disbursement of ₹1,89,343 crore, which is 38.25% of the target.
The Development Commissioner noted that this progress represents an increase of ₹46,228 crore compared to the same period last fiscal year, reflecting a surge in investment and economic activity in Bihar. Among the sectors, the MSME sector showed remarkable performance, achieving a loan disbursement of ₹84,091 crore against a target of ₹1,59,632 crore, translating to 52.68% of the goal.
In the agriculture sector, loans amounting to ₹43,967.17 crore were disbursed against a target of ₹1,57,015 crore, achieving 28.00% of the goal. Overall, in priority sectors, loans totaling ₹1,30,619 crore were distributed against a target of ₹3,55,532 crore, reaching 36.74%.
At the end of the previous financial year, Bihar recorded a historic credit-deposit ratio of 60.21%. This positive momentum continues, with the current CD ratio standing at 60.17% as of September 30, 2026. The total deposits in the state have risen to ₹6,49,225 crore, while outstanding credit has reached ₹3,90,655 crore. Compared to last year, deposits have grown by ₹33,797 crore, and credit has increased by ₹20,092 crore.
During the review of loan flows under various welfare schemes, the Development Commissioner emphasized the need to accelerate the implementation of ambitious initiatives such as the Kisan Credit Card, PM Suryagram Free Electricity Scheme, PM Street Vendor Scheme, and PM Vishwakarma Scheme. Data shows that ₹8,344.70 crore has been disbursed to farmers through a total of 7,37,906 Kisan Credit Card accounts, including 7,12,383 renewed accounts.
In the livestock sector, loans of ₹605.01 crore and ₹11.12 crore for fisheries have been provided. The PM Suryagram Free Electricity Scheme has approved 13,911 applications, facilitating ₹28,451.21 lakh in funding. Furthermore, under the PM Street Vendor Scheme, 2,17,731 applications have been approved, distributing ₹2,09,959 lakh in loans. Additionally, the PM Micro Food Processing Enterprises Scheme and Vishwakarma Scheme have connected 2,748 industries and over 28,625 artisans to financial services.
The Development Commissioner specifically directed major banks performing below the average (38.25%) and categorized as being in the red zone to expedite their credit processes. He stressed the importance of meeting the credit plan targets in mission mode during the remaining months of the financial year. He pointed out that major banks holding significant deposits from the state must ensure their credit-deposit ratio does not fall below 50%.
These banks are expected to reinvest the funds back into Bihar’s agriculture, MSMEs, startups, and infrastructure development to further stimulate the state’s economic growth. He instructed banks to resolve pending loan applications promptly and minimize rejection rates, especially for KCC, PM Vishwakarma, and street vendor schemes.
The meeting included participation from the Principal Secretary of the Finance Department, the Chief Coordinator of the State Level Bankers Committee, senior general managers from various public and private banks, and senior officials from the state government.
Banks were classified into three categories based on the 100-point measurement index. Those in the green zone (50 or more points) include IDFC First Bank, which topped the list with 74 points. Jammu & Kashmir Bank and RBL Bank followed with 68 points each. HDFC Bank scored 65, Bank of Baroda 64, Ujjivan Small Finance Bank 63, Punjab & Sind Bank 58, Bihar Gramin Bank 57, Bank of Maharashtra and AU Small Finance Bank 53 each, and Union Bank of India scored 52 points.
In the yellow zone (40 to 50 points), ICICI Bank and Bank of India scored 47 each, Punjab National Bank 45, Axis Bank, Yes Bank, and Unity Small Finance Bank 42 each, and Indian Bank scored 40 points.
Conversely, banks in the red zone (below 40 points) include Indian Overseas Bank and Central Bank of India, both scoring 37, UCO Bank 35, State Bank of India 32, Canara Bank 27, and IDBI Bank, Bandhan Bank, Kotak Mahindra Bank, and State Cooperative Bank, each with 26 points.
