• Source:JND
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In a bid to improve the performance and accountability of banks operating in the state, the Bihar government has approved the creation of a Bank Ranking Index. The index will assess banks based on specific performance parameters and determine their eligibility for participation in state-related financial operations.

The move comes after widespread dissatisfaction was expressed over the poor performance of many public and private sector banks during a recent meeting of the State-Level Bankers' Committee (SLBC). It was observed that several banks failed to meet their credit disbursal targets under the Annual Credit Plan (ACP) for the financial year 2024–25. Bihar's credit-deposit (CD) ratio also remains significantly below the national average.

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Announcing the decision, Deputy Chief Minister and Finance Minister Samrat Choudhary said that banks are not only custodians of public savings but also play a vital role in driving the state’s economic growth. He stressed the need for increased accountability and vigilance to meet development goals.

The proposed ranking index is being seen as a wake-up call for underperforming banks. Only those institutions that score a minimum of 40 marks on the index will be eligible to handle government schemes, deposits, and transactions involving public sector undertakings (PSUs), authorities, and government-affiliated societies.

Key Parameters of the Bank Ranking Index:

-Achievement of Annual Credit Plan targets

-Improvement in Credit-Deposit Ratio

-Loan disbursement in priority sectors like agriculture, animal husbandry, and fisheries

-Support to Self-Help Groups (SHGs)

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-Participation in government-backed schemes such as Mudra Yojana, Kisan Credit Card (KCC), and PMEGP

The index aims to foster a competitive environment among banks while ensuring that government-related financial services are entrusted to institutions committed to supporting economic development in the state.