‘Clean banking is new normal’

The ‘clean banking’ drive has started showing results with public sector banks (PSBs) increasingly adopting prudent business approach, replacing aggressive lending practices, said Financial Services Secretary Rajiv Kumar. “The NPA crisis brought an opportunity for the introduction of responsible and responsive banking. All the PSBs, which [collectively] have about 75% market share, decided last year to adopt EASE (Enhanced Access & Service Excellence), ushering in paradigm shift in their approach,” he said. “Gradually, Indian banking system is moving towards new normal that is clean banking,” he said. To deal with the twin balance sheet challenge, he said, the four Rs — Recognition, Recapitalisation, Resolution, and Reform — were put in place. Highlighting other measures by the Centre, he said: “Bank accounts of about 2.29 lakh shell firms have been frozen. Banks are already checking for fraud in all bad loans of more than Rs. 50 crore. Passport details have been sought. Another impact is that defaulters have started approaching banks on their own as they have threat of losing control of their business.” The government also decided to provide Rs. 2.11 lakh crore capital support to the banks to maintain regulatory capital requirement as per risk norms, he said.

Source : https://www.thehindu.com/todays-paper/tp-business/clean-banking-is-new-normal/article24733423.ece

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