FM Sitharaman urges rural banks to onboard customers to digital services like mobile banking by December 2024.
Union Finance Minister Nirmala Sitharaman has urged Regional Rural Banks (RRBs) to onboard rural customers for digital services like Internet Banking, Mobile Banking, and UPI. The minister emphasized the importance of digitization during a review meeting held in Patna on Friday with eight RRBs from Bihar, Jharkhand, Odisha and West Bengal.
In the meeting, Sitharaman directed the RRBs to prioritize the customers who are on board with digital services and set a deadline to complete the project by December 2024. He also encouraged RRBs to promote digital adoption among their customers with the support of their sponsor banks.
“RRBs will prioritize customers accessing digital services such as Internet Banking, Mobile Banking, and UPI. RRBs should promote digital adoption with the help of sponsoring banks to promote adoption,” he said.
The finance minister reviewed the business performance, digitalization, and new credit products offered by RRBs, focusing on inclusive growth. He pointed out the importance of increasing the level of lending, especially in activities related to agriculture and micro and small industries, in order to promote the growth of businesses.
Sitharaman also emphasized the need to improve credit flow to women’s self-help groups (SHGs). He urged the state governments to work with NABARD and SIDBI to help SHGs transform into businesses.
He highlighted the potential of the One District One Product (ODOP) program to increase self-employment opportunities in the district and directed financial institutions to provide SHGs with training and marketing support.
The minister emphasized the need for technology development to improve efficiency and service delivery in RRBs. He appreciated the improvement in the financial health of RRBs, with CRAR improving from 7.8 percent in FY22 to 9.4 percent in FY24 and Gross NPAs coming down from 25 percent in FY22 to 15 percent in FY24.
The minister said “RRBs in the Eastern Region posted a consolidated profit of Rs 625 crore during FY 2024 against a net loss of Rs. 690 crore in FY 2023”.
Sitharaman concluded by highlighting the need to maintain asset quality, expand digital services, and ensure strong corporate governance in RRBs to face future challenges.
