Bharatiya Mahila Bank to be merged with SBI

Rural & Marketing - - UPDATES -

The Gov­ern­ment of India has de­cided to merge the Bharatiya Mahila Bank (BMB) with the State Bank of India (SBI) to en­sure greater bank­ing ser­vices out­reach to a larger num­ber of women, at a faster pace. The ob­jec­tives of af­ford­able credit to women as well as prop­a­ga­tion of wom­en­cen­tric prod­ucts need to be quickly achieved through a wider net­work and lower cost of funds.

The de­ci­sion to merge BMB with SBI has been taken in view of the ad­van­tage of the large net­work of SBI among other in­fra­struc­ture. In the three years since BMB was es­tab­lished, it has ex­tended loans of Rs 192 crores to women bor­row­ers, while the SBI group has pro­vided loans of about Rs 46,000 crore to women bor­row­ers. SBI has a large out­reach of more than 20,000 branches and low­est cost of funds in the sec­tor. Out of the to­tal work­force of around 2 lakh em­ploy­ees in SBI, 22 per­cent are women. SBI group al­ready has 126 ex­clu­sive all-women branches across the coun­try while BMB has only seven. The pro­por­tion of ad­min­is­tra­tive and man­age­rial cost in BMB is much higher to reach the same cov­er­age. For the same cost, a much higher vol­ume of loans to women could be given through SBI.

The Union Gov­ern­ment is com­mit­ted to en­hance the ac­cess to fi­nan­cial ser­vices to the pop­u­la­tion at large and women in par­tic­u­lar. Un­der the Prad­han Mantri Jan Dhan Yo­jana, pref­er­ence is given to women for over­draft fa­cil­ity. Prad­han Mantri Mu­dra Yo­jana had 73 per­cent women bor­row­ers in the pre­vi­ous fi­nan­cial year.

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