Banks to step up credit support to economy

Finance Minister  Piyush Goyal reviewed the performance of Public Sector Banks (PSBs) with Secretary, Department of Financial Services Rajiv Kumar and bank CEOs. The review was against the backdrop of visible signs of strengthening of the financial of PSBs as a result of Government’s comprehensive 4R’s approach of recognition, resolution, recapitalisation and reforms, which has positioned PSBs to step up their support to meet the lending needs of a growing economy.

On the back of recapitalisation of PSBs by over Rs. 2.6 lakh crore and recovery of over Rs. 2.8 lakh crore — including record recovery of over Rs. 1 lakh crore in the first three quarters of the current financial year — since clean-up began in 2015, and comprehensive reforms for better underwriting of loans, PSBs committed to significantly step up the level of domestic credit growth from 9.1% year-on-year at the end the second quarter of the current financial year.

Banks agreed to work further on increasing use of advanced data analysis and where possible, Artificial Intelligence algorithms for better, faster and hassle-free credit decisions and monitoring of accounts. Amidst a number of positives, Finance Minister highlighted the need for each and every PSB to ensure that recent gains are sustained and better service delivered to all stakeholders.

In this regard, banks were asked to ensure that the benefits extended under Pradhan Mantri Jan Dhan Yojana by making overdraft facility and accidental insurance cover on RuPay cards more attractive reach the common people, and to ensure opening of accounts as per expanded focus from “every household to every adult”, with added emphasis on usage of accounts by enhancing DBT flows through these accounts, adoption of social security schemes, promoting digital payments through the use of RuPay cards, etc.

Banks were asked to leverage the pipeline of Jan Dhan-Aadhaar-Mobile (JAM) to provide better access to financial inclusion products and services to accelerate the realisation of a digitalised, financially included and insured society.

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