Money & Banking

‘Efficiency, smart banking key to consolidation'

Our Bureau Manipal | Updated on June 27, 2012

Mr Ananthakrishna, Chairman and Chief Executive Officer of Karnataka Bank Ltd.   -  Businessline

Smart banking plays a major role in consolidation in banking industry than the size of the banks, according to Mr Devananda Upadhyaya, General Manager of Syndicate Bank.

Delivering the keynote address at the inauguration of a one-day conference on ‘Contemporary issues in banking', organised by the Commerce Department of the Manipal University here on Tuesday, he said consolidation is the buzzword in the banking sector now.

Neither the big nor the small banks play a key role in consolidation. It is the smart banking that plays the major role in this matter.


Efficiency is essential for smart banking, he said. “Size is not the issue in consolidation. But the efficiency is,” he said.

On the use of technology in banking sector, Mr Upadhyaya said IT is a back-end facilitator for banking. Banking sector needs technology to reduce cost and to add convenience to customers. Though technology is gaining importance in banking sector, there is also need to re-engineer the banking process. Business process re-engineering is a must for banks in the country, he said.

Speaking on financial inclusion in banking sector, he said Syndicate Bank understood the importance of this concept several decades ago and introduced ‘pigmy' – a micro deposit scheme.

Inaugurating the conference, Mr Ananthakrishna, Chairman of Karnataka Bank Ltd, said that 60 crore population in the country is eligible for banking facilities. But a majority of them do not have bank accounts. India has around 65,000 bank branches with Rs 48 lakh crore of deposits and Rs 37 lakh crore of advances.

However, it is yet to reach a majority of people who don't have banking facilities.

Expressing displeasure over loan waivers, he said loan waiver introduces financial indiscipline among borrowers. Rather than introducing loan waivers, farmers should be encouraged to take up agriculture insurance schemes, he added.

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Published on March 11, 2011
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