Skip to main content

Digital Banking Units to further augment digital infra, says RBI governor

By

 Digital Banking Units (DBU), which were inaugurated by Prime Minister Narendra Modi on Sunday, will further augment the country's digital infrastructure, Reserve Bank of India governor Shaktikanta Das said.  “This will act as an enabler in the digital ecosystem and will improve customer experience by facilitating seamless banking transactions,” Das said in his speech. “The DBUs will augment our efforts to promote financial inclusion by providing banking services in a paperless, efficient, safe and secure environment.” The specific financial services to be extended by the DBUs include, savings, credit, investment and insurance. “On the credit delivery front, to start with, the DBUs will provide end-to-end digital processing of small ticket retail and MSME loans, starting from online applications to disbursals,” Das said. DBUs will also provide services related to certain identified government sponsored schemes.

 

The products and services in these Units will be provided in two modes – self-service and assisted modes, with self-service mode being available round the clock, on all days. An announcement was made by finance minister Nirmala Sitharaman during the Union Budget of 2022-23 for setting up of 75 DBUs, following which RBI had issued the required guidelines after consulting the Indian Banks Association and other experts in the field. “It is heartening to note that the commercial banks – both in the public and private sectors – have responded very positively to this initiative. Seventy five DBUs have been set up in a record six months’ time in 75 districts of the country to commemorate 75 years of our independence,” Das said. The setting up of DBUs is a joint initiative of the Centre, RBI, the Indian Banks Association and the participating banks. “The banks are also free to engage the services of digital business facilitators and business correspondents to expand the footprint of the DBUs,” he added. State Bank of India, the country’s largest lender, has opened 12 DBUs out of the 75, which are in places like Port Blair in Andaman & Nicobar Islands, Balod in Chhattisgarh, and East, North and West Sikkim, among others. Bank of Baroda has opened 8 DBUs which are in Varanasi, Kota, Vadodara, among others. HDFC Bank – the country’s largest private sector bank has opened 4 DBUs which are in Haridwar, Chandigarh, Faridabad (Haryana) and South 24 Parganas (WB). ICICI Bank – the second largest private sector bank has also opened four DBUs-- one each in Dehradun, Karur (Tamil Nadu), Kohima and Puducherry.

 

 

-Business Standard, 17th October 2022

 

 

Comments

Post a Comment

Popular posts from this blog

RBI deputy governor cautions fintech platform lenders on privacy concerns during loan recovery

By
  India's digital lending infrastructure has made the loan sanctioning system online. Yet, loan recovery still needs a “feet on the street” approach, Swaminathan J, deputy governor of the Reserve Bank of India, said at a media event on Tuesday, September 2, according to news agency ANI.According to the ANI report, the deputy governor flagged that fintech operators in the digital lending segment are giving out loans to customers with poor credit profiles and later using aggressive recovery tactics.“While loan sanctioning and disbursement have become increasingly digital, effective collection and recovery still require a 'feet on the street' and empathetic approach. Many fintech platforms operate on a business model that involves extending small-value loans to customers often with poor credit profiles,” Swaminathan J said.   Fintech platforms' business models The central bank deputy governor highlighted that many fintech platforms' business models involve providing sm
Post a Comment
Read more

Credit card spending growth declines on RBI gaze, stress build-up

By
  Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the rep
Post a Comment
Read more

India can't rely on wealthy to drive growth: Ex-RBI Dy Guv Viral Acharya

By
  India can’t rely on wealthy individuals to drive growth and expect the overall economy to improve, Viral Acharya, former deputy governor of the Reserve Bank of India (RBI) said on Monday.Acharya, who is the C V Starr Professor of Economics in the Department of Finance at New York University’s Stern School of Business (NYU-Stern), said after the Covid-19 pandemic, rural consumption and investments have weakened.We can’t be pumping our growth through the rich and expect that the economy as a whole will do better,” he said while speaking at an event organised by Elara Capital here.f there has to be a trickle-down, it should have actually happened by now,” Acharya said, adding that when the rich keep getting wealthier and wealthier, they have a savings problem.   “The bank account keeps getting bigger, hence they look for financial assets to invest in. India is closed, so our money can't go outside India that easily. So, it has to chase the limited financial assets in the country and
Post a Comment
Read more