The country's largest bank, the State Bank of India (SBI) aims to partner with agri-tech companies and start-ups to lend to agri sector, Chairman Dinesh Khara said.
Khara, in the lender's annual report for FY23 said that bank has opened specialized branches to lend to start-ups
"Your Bank is actively looking to partner with agri-techs and start-ups to cater to the financial needs across the agriculture value chain. We have also has opened specialised start-up branches at Bengaluru, Mumbai, Delhi and Chennai to offer one-stop solutions to start-ups," Khara said.
Agri and start-up lending
Earlier Moneycontrol reported that some public sector, as well as private sector banks, have seen a pick-up in their agricultural loan book, a segment that lenders have traditionally looked at with abundant caution amid weather uncertainties, and risks like El Nino.
El Nino is a natural phenomenon where the surface temperature of ocean water becomes warmer than usual, which affects the pressure conditions over the Indian Ocean and leads to a weakening of trade winds blowing from east to west. This is accompanied by lower rainfall.
Also read: El Nino could lead to rise in agri-loan NPAs, say experts
The banks, on average, grew their agri loan portfolio by 17 percent on a year-on-year (YoY) basis.
Canara Bank in its results for the quarter ended March 2023 showed a 21 percent growth in its agriculture portfolio on a year-on-year basis. The bank, whose agri-loan book stood at Rs 1.75 lakh crore in quarter ended March 2022, took it to Rs 2.13 lakh crore by the end of the March 2023 quarter.
Among private sector banks, Kotak Mahindra Bank’s customer assets in the agriculture sector grew to Rs 27,547 crore, a growth of 9 percent from Rs 26,128 crore in March 2022.
Federal Bank’s agri-loan portfolio stood at Rs 23,355 crore in March 2023 from Rs 22,050 crore in March 2022.
Also read: Banks' agri loan books see jump despite El Nino risks, aided by strong demand
For lending to startups, other than SBI, banks like ICICI Bank, Bank of Maharashtra, Bank of Baroda and others have opened dedicated branches and digital platforms.
Other than this, for startups affected by the Silicon Valley Bank crisis, many banks designed customised services and financial facilities.
Also read: Bank of Maharashtra opens first dedicated branch for startups in Pune
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