PSU Banks To Launch New Credit Products For Greater Financial Inclusion, Says Financial Secretary

Public sector banks will soon be launching new credit products for greater financial inclusion aimed at providing better access and availability of credit services to small borrowers, financial services secretary, Government of India, M Nagaraju said on November 26, 2024 at the Financial Inclusion and Fintech Summit organised by the Confederation of Indian Industries (CII). 

He said that in the last couple of years, the government has launched various products to ensure credit access to small borrowers and youngsters for various purposes. The government has also incorporated a new credit model in the Budget to facilitate easy credit facility for those without any financial history or records. 

The public sector banks will be launching their products in the next 3-4 months to push funds in all the sectors, including micro, small and medium enterprises (MSME) sector, he said. 

“We are actually committed to enhancing, and we want to push as much credit as possible because we have a huge number of young people,” he added. 

Nagaraju also voiced concern on the rising surge in digital frauds. He said the spike in digital frauds has been increasing, which is a cause for concern. Banks must address this to ensure security to the borrowers, he said. 

Fintech 

He said India is the third largest country in terms of start-ups, with over 13,000 such companies operating in the field. The government is dedicated to the aim of financial inclusion and is collaborating closely with the fintech industry to increase inclusiveness, particularly in underserved areas. 

“The government is making a lot of efforts to foster ease of doing business and reduce compliance burden for the fintech companies,” he said. 

He also mentioned the government’s efforts to provide a secure infrastructure to the fintech industry, through various schemes, such as the Atal Pension Yojana (APY) and PM Suraksha Bima Yojana, which provide a significant amount of opportunities to the Industry. “A fine balance is required between fostering innovation and protecting the regulatory system’s integrity,” he added. 

Banking Amendment Bill 

He said that the Banking Amendment Bill tabled in Parliament during the Monsoon Session will likely be moved in the ongoing Winter Session. The revisions attempt to reform banking laws by redefining significant interest for directors, and expanding the number of nominees for bank deposits, along with amending the compliance reporting dates.