Even as the competitive intensity for incremental lending business is expected to remain muted for some time in FY25, State Bank of India sees this as an opportunity to increase its market share in all lending segments.

India’s largest bank has pencilled in domestic advances and domestic credit growth of 14.65 per cent and 14 per cent, respectively, in the current financial year.

As at December-end 2023, the bank had achieved domestic advances and domestic credit growth of 14.47 per cent and 12.84 per cent, respectively.

ICRA, in a report, said the challenges in mobilising deposits, high interest rates and the increase in risk weights will slow down the pace of credit growth to 11.6-12.5 per cent in FY25 from 16.3 per cent in FY24.

Within the retail-personal segment, the bank is eyeing new market segments and looking for good quality takeovers, per the bank’s plans.

In the agriculture segment, the bank wants to diversify from small ticket, base level farm credit to multi-product offering and commercial agriculture.

In the MSME (micro, small and medium enterprise) segment, SBI is aiming for a shift in approach from being only a lending bank to ‘total relationship value’ (capturing the entire supply chain ecosystem) and provide digital suite for customers. It also wants to sweat the business rules engine-based balance sheet lending capability to its fullest to build quality book.

In the corporate segment, the bank wants to leverage the upturn in the capital expenditure cycle, focus on highly rated entities and cross vertical synergy.

Deposit growth: Phygital approach

With deposit growth continuing to lag the credit growth, SBI is banking on its widespread ‘Phygital’ (Physical and digital) distribution network to capture incremental deposits and remain a step ahead of competition.

In this regard, the bank plans to give special focus on offering end-to-end solutions to trade, commerce, industries, institutions and family offices.

The target market for deposits includes liaising with State governments to target retiring employees; stepping up liaison with insurance companies, public sector undertakings, government bodies and companies; opening savings bank accounts by organising camps at schools and colleges; and tapping opportunities in premier banking, wealth business and NRI business segments.

Further, virtual relationship managers will be placed to reach out to UHNI (ultra-high net worth individual) NRI (non-resident Indian) customers. It also plans to make YONO app available to function overseas for NRIs.