State Bank of India (SBI) explores opportunities to enter into partnerships with select Agritechs to handle high volume and low-ticket loans in the Agribusiness optimally through a digital strategy.
India’s largest bank sees Agritech (agricultural technology) as a channel to bring in a new segment of customers (which the bank could not access earlier) – a channel to improve decision making, grow top-line and improve efficiency.
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“The partnership will also serve as an opportunity to cut operational costs, credit costs, improve profitability and user experience as digital transformation will no longer be optional but a necessity for structural change in the digital ecosystem,” as per the bank’s annual report.
The bank wants to enter into partnerships with Agritechs with a differentiated business model that will help facilitate the transformation of the Agri supply chain to improve farm production opportunities for the farmers.
This will be done using digital tools such as Artificial Intelligence (AI), Blockchain, IoT (Internet of Things) and Machine Learning-powered capabilities.
During FY21, SBI disbursed ₹1,98,268 crore against the target of ₹1,74,468 crore.
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“Growth in agriculture and allied activities is the only silver-lining in such a gloomy year.
“Agri Gross Value Added expanded by 3.6 per cent in FY2021 due to sufficient access to inputs, adequate and well-spread south-west and northeast monsoon rains, sufficient reservoir levels and improved soil moisture,” the report said.
According to data on the sectoral deployment of bank credit for March 2021, credit growth to Agri and Allied activities accelerated to 12.3 per cent in March 2021 (4.2 per cent a year ago), the highest since April 2017, it added.