FM Nirmala Sitharaman meets heads of PSBs, asks banks to launch special drives to mobilise deposits

The minister specifically asked bank chiefs to ensure that bank employees reach out to connect with their customers, especially in rural and semi-urban areas. Sitharaman appreciated the performance of PSBs in FY24. In the last financial year, the PSBs’ net non-performing assets stood at 0.76 per cent, capital adequacy at 15.55 per cent, net interest margin at 3.22 per cent, and highest ever net aggregate profit of Rs 1.45 trillion. They have paid a dividend of Rs 27,830 crore to the shareholders. Improvements over various parameters have also enhanced the ability of PSBs to raise capital from the markets, she said.

She asked the banks to expeditiously implement the recent Budget announcement of a new credit assessment model for MSMEs based on digital footprints and cash flows. This is expected to be a significant improvement over the traditional assessment of credit eligibility based only on asset or turnover criteria. That will also increase coverage of MSMEs without a formal accounting system.

Banks were also instructed to focus on further increasing credit flow to eligible beneficiaries under various government initiatives like PM Surya Ghar Muft Bijli Yojana and PM Vishwakarma Yojana. The issues related to digital payments and cyber security framework were also deliberated in the meeting.

The minister also asked the banks to ensure compliance with the RBI’s guidelines on the handover of security documents after the closure of the loans and directed that there should not be any delay in handing over the documents to the customers. FE

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