Chinmaya IAS Academy – Current Affairs Chinmaya IAS Academy – Current Affairs
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Recently, the Union Minister of State for Finance has stated in the Rajya Sabha that the Government has taken a number of steps to facilitate digital banking, doorstep banking services and digital lending platforms.
Important points:
- It is the digitization (or moving online) of all the traditional banking activities and programs services that were historically only available to customers when physically inside of a bank branch.
- This includes activities like Money Deposits, Withdrawals, and Transfers, Checking/Saving Account Management, Applying for Financial Products, Loan Management, Bill Pay, Account Services.
Challenges:
- Internet access is not the only barrier to adoption of digital payments.
- Educating users as well as ensuring the security of their data is essential.
Initiatives:
- It was launched in January 2018 jointly by the government and PSBs.
- It was commissioned through Indian Banks’ Association and authored by Boston Consulting Group.
- EASE Agenda is aimed at institutionalizing CLEAN and SMART banking.
- EASE Reforms Index: The Index measures performance of each PSB on 120+ objective metrics. The goal is to continue driving change by encouraging healthy competition among PSBs.
- The EASE 1.0 report showed significant improvement in PSB performance in resolution of Non Performing Assets (NPAs) transparently.
- EASE 2.0 builds on the foundation of EASE 1.0 and introduced new reform Action Points across six themes to make reforms journey irreversible, strengthen processes and systems, and drive outcomes.
- The six themes of EASE 2.0 are:
Responsible Banking; Customer Responsiveness; Credit Off-take, PSBs as UdyamiMitra (SIDBI portal for credit management of MSMEs); Financial Inclusion & Digitalisation; and Governance and Human Resource (HR).
- It seeks to enhance ease of banking in all customer experiences, using technology viz. Dial-a-loan, Partnerships with FinTechs and E-commerce companies, [email protected], Tech-enabled agriculture lending, EASE Banking Outlets etc.
- State-run banks will focus on co-lending with non-banking firms, digital agriculture financing, synergies and technological resilience for 24×7 banking as part of their reforms agenda for this fiscal, Ease 4.0.
Way Forward
- Digital is the only way forward. Banks will have to hitch to this bandwagon by adapting new age technologies like Blockchain, Artificial Intelligence, Machine Learning, and Internet of Things (IOT)
- Cross-selling through Intelligent Analytics driven on the strength of big data and curated product offerings for different customer segments is what will distinguish banking offerings.
SOURCE: THE HINDU,THE ECONOMIC TIMES,MINT
