Canara Bank likely to open 600 ultra small branches this fiscal

To drive more business from its business correspondents, Canara Bank plans to open 600 ultra small branches this fiscal.

Of these, 300 would be under the parent bank and 300 under the Canara Bank-sponsored regional rural banks, Ms Archana Bhargava, Executive Director, Canara Bank, told Business Line. The bank has opened 41 ultra small branches so far.

“These branches will instil a much wanted confidence in dealing with business correspondents who will now have an identity as the bank's agents,” she said, pointing out that with the setting up of ultra small branches, all the BCs would be provided with laptops and receive assistance from staff of nearby branches.

The brick and mortar branches that Canara Bank set up in its financial inclusion villages last fiscal have also received good response, said Ms Bhargava. The bank set up 167 brick and mortar branches in its financial inclusion villages. “We have so far opened over four lakh accounts with a total business of Rs 405.15 crore,” she said.

This includes Rs 177.84-crore advances and deposits of Rs 227.35 crore. According to her, one such branch at Gudivakalanka in West Godavari district of Andhra Pradesh garnered business of Rs 21.89 crore in the eight months since it was opened in August 2011.

The bank also plans to focus more on urban financial inclusion. It is looking at increasing the urban financial inclusion branches to 50 by 2014 from the current 19. Bank officials pointed out that they had expected labourers to remit their wages at these branches, similar to the bank's experience at Dharavi in Mumbai. “In reality we see more business from self-help groups and joint liability groups,” they said.

The urban financial inclusion branches saw a total business of Rs 150 crore as on March 31, 2012, from over 67,000 accounts.

anju@thehindu.co.in