NEW DELHI: Bankers say that the 59-min loan portal, which is being extended to sanction the auto loan and the home loan will not mean grant of loan, but it will be subject to internal scrutiny and approval of the bank to sanction the loan.
“The 59-minute loan scheme is being extended to even home loan and auto loan. While it will help in streamlining the application process, it will not guarantee sanction of loan. Even in the case of MSME, final sanctioning of loan is too less and is subject to internal approvals after the scrutiny,” a senior branch manager with the SBI told this publication.
The In-Principle approval is given based on the data provided by the borrower. After receiving the In-Principle Approval, the lender will conduct thorough due diligence and will take a call on whether to Sanction and disburse the proposal. The final decision will be at the lender's discretion.
The government has initiated 59-minute loan portal last year but small business owners are yet not very enthused with the Micro Small and Medium Enterprise (MSME) 59-minute loan scheme.
Last week the finance ministry, in an internal communication says that all the PSUs are expected to extend the 59 minutes scheme to retail borrowers for auto and home loan, seeing the stress in these two sectors.
All the PSUs are expected to launch the scheme in the coming weeks. The initiative was taken to make disbursement of credit easier for the common people and to revamp the retail loan portfolio of banks.