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FM Nirmala Sitharaman launches next gen banking reforms to drive digital growth among PSBs

The finance minister Nirmala Sitharaman on Wednesday launched the fourth edition of the Public Sector Bank Reforms Agenda ‘Enhanced Access and Service Excellence (EASE) – 4.0’. The reforms agenda is focussed towards imbibing tech-enabled, simplified, and collaborative banking. The first edition of EASE 1.0 was launched in January 2018.

Under EASE 4.0, PSBs would offer new age 24×7 banking with resilient technology has been introduced to ensure uninterrupted availability of banking services, improving the reliability of technology platforms, and aligning internal processes in the state-run banks to deliver such services.

“The next edition of EASE reforms aims to further the agenda of customer-centric digital transformation and deeply embed digital and data into PSBs’ ways of working,” a report on the features released by the press information bureau stated.

The EASE reforms also aim to bring in collaborative banking through tie-ups between PSBs and with broader financial services ecosystem such as NBFCs for the coordinated handling of co-originated loans.

Banks will also work towards increased use of digital data for agriculture financing through partnerships with third parties for alternate data exchange, driving impetus on digital payments in semi-urban and rural areas and at-scale adoption of doorstep banking services for state-run bank customers.

Public Sector Banks reported a profit of Rs. 31,817 crore in FY21 as compared to a loss of Rs. 26,016 crore in FY20. This is the first year when PSBs have reported profit after five years of losses. Total gross non-performing assets stood at Rs. 6.16 lakh crore as of March 2021 – a reduction of Rs. 62,000 crore from March 2020 levels.

In FY21, PSBs have collectively disbursed Rs. 40,819 crore of fresh personal, home and vehicle loans through leads sourced from such digital channels. In FY21, Rs. 49,777 crore of fresh retail loan disbursements were made by the top 7 PSBs based on select credit offers.

PSBs have also extensively used external partnerships and dedicated marketing salesforce network for the sourcing of retail segment and MSME segment loans. Sourcing from such channels has been 9.1 lakh loans in FY21.

Nearly 72% of financial transactions happening at PSBs is now happening through digital channels.

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