Mumbai:16/9/22:Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman has exhorted the banking sector to play a lead role in realising the dream of a developed India by 2047. The Finance Minister observed that the next 25 years which the Prime Minister refers to as Amrit Kaal has taken off very well, with the auspicious beginning of India becoming the fifth largest economy of the world. “We have so much and more to do, the banking industry needs to serve the Amrit Kaal, we have to see how best we can lift ourselves to meet the aspirations of a growing India. The Prime Minister has said that we need to be the developed country we deserve to be, by 2047. It is the banking sector which has to make a big contribution towards this.” She was addressing the 75th Annual General Meeting of Indian Banks’ Association in Mumbai today, September 16, 2022.
The Minister said that banks are the biggest catalysts to growth. “Professionalise your decision-making boards, there is no way banks can any longer run with a crony background, our government has ensured that there are no instructions given or interference made in the functioning of the banks. We need to take professionalism at a faster pace. We are conscious of the need to let the banks be, and let them run by professionals, with a purely banking perspective in mind.”
The Finance Minister exhorted the banks to plan for the next 25 years. “You need to have strategies to meet the aspirations of the youth of India in the next 25 years. You need to make your portfolios so that they are attractive to the young as well and make yourselves accessible to them. Are you communicating to the youth, to women, are you offering products to them?”
“Are you digital savvy? Are your staff digital savvy?” The Minister asked the banking community. “Are you comfortable in being a digital institution? How much training goes into this? Do your systems talk to each other? It will be a big missed opportunity if these bridges between banks are not built. IBA should plan to make sure that all systems in all banks, whether private or public, should be talking to each other for the purpose of the customer. Account Aggregator Framework that the customer is benefitted when such systems are put in place with the consent of the customer.”
The Minister said that such technologies also bring in benefits such as detecting fraud, tracking of wrong money, detecting unusual transactions, alerting yourself and the government. “Use of Web3, data analysis, Artificial Intelligence, deep dive into data – all of these should have some coordination by the IBA. Leveraging AI should be an immediate priority for the banks, especially in fraud detection and generating early warning signs about something going wrong.”
The Minister highlighted the importance of cyber protection for the banks. “Are you all geared to have adequate firewalls? Are you protected against hacking and Black Swan events which bring down your systems?”
The Minister underlined the importance of having staff who can speak the local language, considering the diversity of the nation. “Show inclusivity in your staff, in the way you speak to your customers. When you have staff who do not talk the regional language and who demand citizens to speak in a particular language, you have a problem. Please review the people getting posted at branches, people who cannot speak local language should not be assigned to roles dealing with customers. You must have a lot more sensible ways of recruiting people.”
The Finance Minister pointed out that there are still some areas of the country which do not yet have brick-and-mortar banks. “If there is a way you can provide ATMs or Business Correspondents in such areas, I would welcome that. The more Business Correspondents are women, the better it would be for your business. The regions which have not had enough coverage and where we can bring in digital technology, please look at what can be done. Yardsticks applicable to other areas would not apply to the North Eastern Region. We need banks there, we need financial inclusion for the region as well.”