Page 6 - Banking Finance October 2022

BANK UPDATE

"Co-lending could specifically be al- encourage further adoption of digital PSBs' quarterly financial performance
lowed in cases where we can get ex- payments and promotion of payment was reviewed based on broad param-
pertise. For example, if an SFB wants platforms that are economical and eters such as credit growth, asset qual-
to enter commercial vehicle (CV) fund- user-friendly. ity, and recoveries made during the
ing, it makes more sense for it to tie year, and their projections for the en-
up with a specialised CV player (NBFC) Govt nudges banks to give tire year. Their preparedness for ad-
rather than doing it all by themselves," vancing loans ahead of the festive sea-
more education loans
said a senior SFB official. son was also assessed.
With Public sector banks wary of dis-
Industry watchers say the banking Besides financial performance, efforts
bursing low-value education loans
regulator seems to be open to SFBs' taken by PSBs towards financial inclu-
claiming defaults, the Government has
co-lending demand. If these banks and sion, improving penetration of the
asked them to increase disbursement,
NBFCs join forces, it will increase pri- Centre's flagship insurance schemes,
citing several complaints received from
ority sector lending (PSL), which is a and saturation campaign of the PM Jan
various quarters on delay in sanction
focus area for both the Government Dhan Yojana (PMJDY) were also
and denial on "flimsy grounds", has
and RBI. PSL is productive and gener- gauged.
learned.
ates income for borrowers.
Some of the PSBs such as Bank of
An official source said the issue was
"In the case of microfinance, SFBs Baroda, Canara Bank, and Union Bank
discussed in a meeting held recently by
don't want to hold all the exposure in of India have seen an increase in their
the Department of Financial Services
their books. If co-lending is allowed share of Jan Dhan accounts this year
(DFS) and involving representatives of
with another NBFC or another main- as compared to last year, while others
all 12 PSBs. Banks were told that the
stream Bank, it will help SFBs manage such as State Bank of India, Central
department has received a lot of com-
their risks. Probably, RBI is waiting for Bank of India and Indian Bank saw their
plaints from a range of quarters, in-
all SFBs to list before liberalising this share of such accounts decline during
cluding the highest levels in the gov-
rule," say experts. the same period.
ernment. "They were asking to in-
crease education loan disbursement,"
Finance Ministry: No Bandhan's non-microfin
said the source.
move to levy charges on pie at 56%
The banks were told to disburse edu-
Bandhan Bank has moved on from the
UPI services cation loans within the stipulated time
days when its entire advance book
of 15-30 days, not to deny loans on
There is no move in the government to comprised just microcredit, said its MD
"flimsy grounds", such as CIBIL score of
levy any charges on UPI (Unified Pay- & CEO Chandra Sekhar Ghosh. "The
co-borrower and non-eligibility of
ments Interface) transactions, the fi- share of microcredit has come down to
courses, and not to seek collateral se-
nance ministry said. It asserted con-
44%, while the remaining 56% consists
curity for such loans up to Rs 7.5 lakh.
cerns of service providers for cost re- of non-microfinance loans," he said at
covery have to be met through other Banks were also asked to guide educa- the seventh anniversary celebrations
means. tion loan seekers on the Central Sec- of the bank.
tor Interest Subsidy Scheme for stu-
"UPI is a digital public good with im- Speaking on the growth in non-
dents with an annual family income of
mense convenience for the public and microfinance segment, Ghosh said:
up to Rs 4.5 lakh.
productivity gains for the economy. "Our home loan portfolio is increasing
There is no consideration in the gov- at a pace of nearly 20% year-on-year.
Finance Ministry reviews
ernment to levy any charges for UPI The bank is also well-placed to disburse
services," the finance ministry said on PSBs on inclusion schemes over 8,000 two-wheeler loans per
Twitter in a series of posts. month during this fiscal from 3,000
The finance ministry reviewed the fi-
earlier." The bank currently has about
It said the government had provided nancial performance of public sector
three lakh home loan customers.
financial support for the digital pay- banks (PSB) and progress made by
ment ecosystem last year and has an- them on the Centre's financial inclusion As a part of its focus to make its distri-
nounced the same this year as well to initiatives. bution strongeroutside the east,
6 | 2022 | OCTOBER | BANKING FINANCE