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State Bank of India, the country’s largest lender, will offer overdraft and loan facilities to nearly seven lakh account-holders who have enrolled with it through the Pradhan Mantri Jan Dhan Yojna (PMJDY).
Under the PMJDY scheme, the public sector bank has opened 10 crore accounts, its Chairman, Arundhati Bhattacharya, said here on Wednesday.
Under its financial inclusion plan, the bank continues to open around 60,000 accounts a day.
According to Bhattacharya, SBI has looked at transactions and identified the accounts where it will offer overdraft facilities or loans. These account-holders are mostly from the very low-income group. “We are gauging the number of accounts where we can provide overdraft facility. Some seven lakh have already been identified,” Bhattacharya said on the sidelines of a Banking Conclave organised by the Federation of Indian Chambers of Commerce and Industry.
The exact quantum of loan or overdraft has not yet been decided.
However, she added that the disbursals could be for entrepreneurship or be given as personal loans. Monitoring will be done through the use of technology and also by engaging business correspondents (BCs).
Small-value offerings The bank, according to Bhattacharya, is also looking at small-value insurance products and flexible deposit schemes, especially through BCs.
These products will again target people who are generally shy of the formal banking sector and fall easy prey to deposit-taking schemes.
“It is on account of the inability of people to access banks that several small deposit schemes flourished in places like West Bengal. Through the BCs, we will give access to banking facility to rural people.
“We are coming out with small-value insurance, investment products and flexi-deposit schemes,” she said.
SBI is increasingly focusing on the franchisee model for financial inclusion, she added.
According to Bhattacharya, technology is expected to play a greater role in the bank in order to reach out to villages and areas not covered by the banking sector.
Interestingly, awareness about these new offerings targeting rural India or low-income groups will be enhanced through use of technology, such as local language messaging on mobile phones, among others.
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