Second Leg Of Ideation Exercise For PSU Banks To Begin From Thursday
Public sector banks will embark on second round of two-day bottom-up ideation exercise beginning Thursday for further streamlining the banking sector to help the nation become a $5-trillion economy in five years.
The second leg of the month-long campaign will be inter-bank and will be held at state-level as per the direction of Department of Financial Services, Ministry of Finance.
The first round was focused at branch level and suggestions and ideas received from there will now be discussed at the state level from tomorrow, official sources said.
Meetings will be held at 30 places, mostly in the state capitals, and will see participation from middle level management.
They will deliberate on the issues and concerns being faced by various banks along with performance review, sources said, adding that they will also come up with ideas and suggestions for preparing a road map for the future growth of banking sector.
The move by the finance ministry is aimed at reinvigorating the sagging economy in which the banking sector has an important role to play, especially in boosting consumption through higher credit flow to the productive sectors.
Nine thematic papers by domain experts on various challenges facing the banking sector will be discussed during the meet with a view to suggest reforms in public sector banks.
These themes include increasing digital payments, credit for India's MSMEs, agriculture credit, export credit in India and need to establish financial grid.
The consultation process is aimed at aligning the banking sector with national priorities, stimulating ideas and inculcating a sense of involvement among bankers at the branch level, it said.
The campaign envisages not only performance review but also synchronisation of banking with region-specific issues and their growth potential.
It also aims to find out role of PSBs as active partners in the Indian growth story for the next five years. The country has set a goal of achieving a $5 trillion economy by 2024-25.
It will also find solution for enhanced ease of living, making banks more responsive to customers and challenges before banks and their preparedness in areas such as cyber-security and data analytics.
The campaign comes at a time when the economy is facing headwind and the growth has slowed to a five-year low of 6.8 percent.
There are ominous signs showing that the slowdown may be deep. The automobile sector is facing its worst crisis in two decades and reports suggest thousands of job losses in the auto and ancillary industry.
In the real estate sector, the number of unsold homes has increased, while fast-moving consumer goods companies have reported a decline in volume growth in the first quarter.
Though lending by banks to industries has shown a significant jump from 0.9 per cent in June 2018 quarter to 6.6 percent in the corresponding period this year, the same to job-creating MSME sector has slipped from 0.7 percent to 0.6 percent during the same period.
However, improvement in non-performing assets of the banks is the silver lining amid the gloom.
Last month, Finance Minister Nirmala Sitharaman told Parliament that total bad loans of commercial banks declined by Rs 1.02 lakh crore to Rs 9.34 lakh crore in 2018-19 on the back of steps taken by the government.