Union minister of finance and corporate affairs Nirmala Sitharaman Wednesday unveiled the fourth edition of the Public Sector Bank (PSB) Reforms Agenda for 2021, called ‘EASE 4.0’, in Mumbai to make banking tech-enabled, simplified and collaborative. She also launched the 2020-2021 annual report for the PSB Reforms Agenda EASE 3.0 and felicitated best performing banks on EASE 3.0 Banking Reforms Index.

State Bank of India, Bank of Baroda and Union Bank of India were ranked best performing banks under PSB Reforms EASE 3.0 index.

Indian Bank won the award for best improvement from baseline performance. SBI, BoB, Union Bank of India, Punjab National Bank and Canara Bank won the top awards in different themes of the PSB Reforms Agenda EASE 3.0.

For the first time after reporting losses for five consecutive years, PSBs have reported healthy profits and have accelerated on technology-driven reforms. These banks have reported a profit of Rs 31,817 crore in FY21 as compared to a loss of Rs 26,016 crore in FY20.

As of March 2021, total gross non-performing assets stood at Rs 6.16 lakh crore a reduction of Rs 62,000 crore from March 2020 levels.  

Credit@click was a flagship initiative under EASE 3.0,  benefitting almost 4.4 lakh customers through instantaneous and simplified credit access.

PSBs have been able to setup mechanism for customers where they can register loan requests 24x7 through digital channels like mobile and internet banking, SMS, missed call and call centre. In FY21, PSBs have collectively disbursed Rs. 40,819 crore of fresh personal, home and vehicle loans through leads sourced from such digital channels.

Through the setup of dedicated analytics teams and IT infrastructure, top seven PSBs have built analytics capabilities to proactively offer loans to their existing customers. In FY21, Rs 49,777 crore of fresh retail loan disbursements were made by these top 7 PSB’s through existing customer transactions data within the banks.

PSBs have also sourced 9.1 lakh loans in FY 21 in retail and MSME segments extensively through external partnerships and dedicated marketing salesforce network

Nearly 72% of financial transactions happening at PSBs is now happening through digital channels. PSBs are now offering services across call centres, internet and mobile banking in 14 regional languages such as Telugu, Marathi, Kannada, Tamil, Malayalam, Gujarati, Bengali, Odia, Kashmiri, Konkani, Hindi, Punjabi and Assamese for ease of customers.

Under financial inclusion initiatives 13% growth in transactions was registered through Bank Mitras in rural areas and 50% increase in enrolments in micro personal accident insurance in Q4FY21 as compared to Q4FY20.

There has been phenomenal growth in performance of PSBs over four quarters since the launch of EASE 3.0 Reforms Agenda. The overall score of PSB’s increased by 35% between March-2020 and March-2021 with the average EASE index score improving from 44.2 to 59.7 out of 100. Significant progress is seen across six themes of the reforms agenda with the highest improvement seen in the themes of ‘Smart Lending’ and ‘Institutionalising Prudent Banking’.

EASE 4.0 aims to further the agenda of customer-centric digital transformation and deeply embed digital and data into PSBs by way of (1) Smart lending with Dial -a-loan for doorstep facilitation, Credit @click  with end to end digital retail and MSME lending for new to bank customers, (2) 24x7 banking with deeper penetration of mobile and internet banking, cloud based IT systems  and process automation, (3) data based agriculture financing  with dial a loan for agri- loans, partnership with agri techs and automated processing and financing and (4)  digital payments in semi urban and rural areas,  scaling up doorstep delivery and co lending with NBFCs.    

Complimenting PSBs for continuing to provide uninterrupted service and credit delivery to  their  customers despite the pandemic, Sitharaman said, “They (PSB’s) have also been at the forefront of extending banking services in the remotest parts of the country. From different modes of staffing to remote working, more than 80,000 bank branches were operational during Covid-19. Additionally there has been around two times increase in Aadhaar enabled payment system (AEPS) transactions through micro ATMs and enhanced doorstep banking support by more than 75,000  bank mitras.”

Further to provide relief to families of bank employees, the finance ministry also announced 30% increase in family pension against last drawn salary. This move will increase the family pension by up to Rs 30,000 to Rs 35,000 per family of bank employees. The government has also approved the proposal to increase employers contribution under the New Pension Scheme to 14% from the existing 10%.