Finance Minister Nirmala Sitharaman on Thursday instructed all the Public Sector Banks (PSBs) to onboard on account aggregator system by end of July.

She said this while chairing a meeting with heads of Public Sector Banks and Regional Rural Banks (RRBs) to review Operational & Governance reforms in RRBs and performance of Kisan Credit Card (KCC) scheme for Animal Husbandry, Dairying and Fisheries.

An Account Aggregator (AA) is a type of RBI-regulated entity (with an NBFC-AA license) that helps an individual securely and digitally access and share information from one financial institution they have an account with to any other regulated financial institution in the AA network. 

Data cannot be shared without the consent of the individual. There will be many Account Aggregators an individual can choose between. AA replaces the long terms and conditions form of ‘blank cheque’ acceptance with a granular, step by step permission and control for each use of your data.

India’s financial system involves many hassles for consumers today — sharing physical signed and scanned copies of bank statements, running around to notarise or stamp documents, or having to share your personal username and password to give your financial history to a third party. The AA network would replace all these with a simple, mobile-based, simple, and safe digital data access & sharing process. This will create opportunities for new kinds of services — for example, new types of loans.

Reviewing sponsor banks

Meanwhile, the Finance Minister underlined the important role being played by RRBs in financial inclusion and serving the credit needs of rural economy. She  urged the Sponsor Banks to formulate a clear roadmap in a time-bound manner to further strengthen the RRBs and support the post pandemic economic recovery. Sitharaman further advised IBA and sponsor banks to play a lead role in technological advancements in the RRBs. She suggested to conduct a workshop of RRBs so that they can share the best practices with each other.

In the second session, Sitharaman reviewed the progress in issuance of KCC to Animal Husbandry, Dairying and Fisheries Sector with Banks and RRBs. Union Minister for Fisheries, Animal Husbandry and Dairying Parshottam Rupala also attended the session. Union Minister of State Finance Bhagwat Kisanrao Karad was also present during both the sessions.

With an aim to provide the benefits of KCC loans to maximum number of farmers, a special KCC saturation drive was launched under Atma Nirbhar Bharat Abhiyan to cover 2.5 crore farmers under KCC with a credit boost of ₹2-lakh crore. It is noteworthy that as on July 1, 3.26 crore farmers (including 19.56 lakh Animal Husbandry, Dairy and Fisheries farmers) have been covered under the KCC scheme, with sanctioned credit limit of ₹3.70-lakh crore.