Page 6 - Banking Finance October 2023

BANK UPDATE

nation," the PM said on microblogging Card and Axis Bank do not allow their spondents were from tier one, 34%
site X, formerly Twitter. customers to pay above the outstand- from tier two and 22% were from tier
The total number of Jan Dhan ac- ing amount on their apps. three, four and rural districts.
counts, as per latest reports submitted "There is also a recent guideline that "In summary, the findings of the sur-
by banks, crossed 50 crore on August asks banks to refund excess credit bal- vey indicate that 41% of families have
9, 2023. ances on cards within a certain period. one or more individuals with bank ac-
A credit card is not a prepaid card counts that they are not able to access
Bank credit likely to grow product to permit loading and online," it said.
utilisation of the instrument," they
13-13.5% in FY24: CARE said. SBI to send chocolates to
Scheduled commercial banks' (SCBs)
credit growth is expected to be in the UPI wallet for foreign na- borrowers who are likely
range of 13.0-13.5 per cent for FY24, to default on monthly re-
excluding the impact of the merger of tionals
HDFC with HDFC Bank, according to CheqUPI, a UPI wallet designed specifi- payments
CARE Ratings. cally for foreign nationals and Non- State Bank of India is adopting a novel
Credit off take experienced robust Resident Indians experience digital way to ensure timely repayments, es-
growth of 16.2 per cent in Q1FY 24 payments in India has been launched. pecially by its retail borrowers, by
and the outlook remains positive for Despite the widespread adoption of greeting those likely to default on
FY24, per the rating agency's analysis Unified Payments Interface in the monthly instalments with a pack of
chocolates.
of 30 banks, including 12 public sector country, foreign nationals have faced
banks and 18 private sector banks. hurdles due to the requirement of an The move, aimed at ensuring better
Indian bank account and phone num- collections, comes amidst rising level of
Banks disallow excess ber. CheqUPI intends to bridge this gap retail lending in the system coupled
and provide a seamless digital payment with increasing delinquency levels on
funds in credit card A/Cs experience for foreign visitors, accord- the back of the upward movement in
Indian banks are no longer allowing ing to a press release. the interest rates.
credit card users to pay more than SBI's retail loan book grew over 16.46
their outstanding amount. And in the Online bank a/cs inacces- percent to Rs.12,04,279 crore in the
cases where the overpayment has June 2023 quarter from Rs. 10,34,111
been done, they are refunding the ex- sible to many due to de-
crore in the year-ago period, making
cess amount. funct credentials it the largest asset class for the lender
The main reason for this is that the Several individuals across India are whose total book stood at Rs.
banks are concerned about money unable to access their bank accounts 33,03,731 crore, growing at 13.9 per
laundering and fraud. A bank executive online for reasons ranging from defunct cent on-year.
said that there have been cases where user credentials to account turning In fact for the entire system, the
the excess amount parked in the dormant, with the system of resuscitat- double-digit loan growth of around 16
customer's credit cards has been used ing it an arduous process, a survey has per cent has been led by retail loans
for international transactions using found. only.
hacking.
Community social media platform Lo- "With two fintechs which use artificial
The banks have put guards in their cal Circles said after issues were re- intelligence, we are piloting a novel
applications to prevent customers ported by banking consumers over 18 way of reminding our retail borrowers
from overpaying. It is allowed to send months, it conducted a survey to un- of their repayment obligations. While
money through other banks, but in derstand the type and magnitude of one is doing conciliation with borrow-
those cases, the card-issuing banks re- difficulties faced by consumers. It re- ers, the other is alerting us on the pro-
turn the surplus funds within a week. ceived 31,000 responses from 14,502 pensity of a borrower to default. And

The report said that HDFC Bank, SBI citizens and the platform said 44% re- to such borrowers who are likely to

6 | 2023 | OCTOBER | BANKING FINANCE