NEW DELHI: Finance Minister Nirmala Sitharaman has said that India needs four or five more banks like the State Bank of India (SBI) to scale up the banking services to meet the changing requirements in the light of shifting recent realities of economy and industry.
Sitharaman said this during her keynote address at the 74th Annual General Meeting of the Indian Banks’ Association (IBA) in Mumbai on Sunday. SBI, with a loan portfolio of Rs 25.23 lakh crore and deposit of Rs 37.2 lakh crore as on 30 June 2021, is the biggest Indian bank and corporate lender. Compare this to India’s largest private sector bank ICICI Bank, which has a total loan portfolio of Rs 7.4 lakh crore. Two other public sector banks -- PNB and Bank of Baroda – had a total loan portfolio of around Rs 7.2 lakh crore. The finance minister underlined the importance of seamless and interconnected digital systems in creating a sustainable future for the Indian banking industry.
“Long-term future of Indian banking is going to be largely driven by digitised processes.” Pointing out the wide disparities in access to financial services despite digitisation of banking services, she said there are parts of our country where brick-and-mortar banks are necessary. The FM asked the IBA to improve access to banking in every district through optimal utilisation of digital technologies.
She suggested the IBA carry out digitised location-wise mapping of all bank branches for every district of the nation. Sitharaman stressed on the need to strengthen Unified Payment Interface (UPI). “In the payment world today, Indian UPI has actually made a very big impression. A RuPay card which was not as glamorous as a foreign card is now accepted in so many different parts of the world, symbolic of India’s futuristic digital payment intentions.”
FinTech understands that UPI is its backbone, you have to give it its flesh and blood, the Minister advised bankers. On National Asset Reconstruction Company Ltd, which was recently cleared by the cabinet, Sitharaman clarified that NARCL is not a bad bank and that it is a formulation which is intended to clean up banks’ assets and dispose of NPAs in a speedy manner.