PSBs’ average credit growth in the year through March 2018 was 4.7 percent, compared to 20.9 percent for private banks
Public sector banks are planning a common portal to offer competitive and instant personal, housing and retail loans to customers as a part of scaling up the government's financial inclusion drive.
The portal would help banks offer loans to individuals and small and micro industries based on the worthiness of the borrower, reported The Economic Times.
"This is the next phase of banking where customers can avail of loans quickly and don’t have to run around waiting for approvals," a senior finance ministry official told the bank, adding that the move is a part of scaling up the government's Pradhan Mantri Jan Dhan Yojana to make formal banking more inclusive.
In the online portal, a borrower can fill in the required details online, following which they will receive competitive offers from interested lenders on personal loans, home loans or auto loans. The customer can then compare the offers and avail one as per their requirement.
The banks would share a common checklist to assess the borrower's creditworthiness.
The move is aimed at making business transactions at PSBs quicker and hassle-free with the help of new technologies. "Brick-and-mortar branches will progressively become redundant. This portal will have simplified forms and processes to help borrowers get faster approvals on their application," the official said.
Such a move may help the public sector banks expand their loan portfolio. PSBs’ average credit growth in the year through March 2018 was 4.7 percent, compared to 20.9 percent for private banks.
“PSBs will reverse this trend,” the official said.
The last 12 months have not been good for the banking sector in India as the sector finds itself neck-deep in NPAs, frauds and a massive loss of credibility.
The government will be extending their support to the public sector banks for setting up such a portal.“There have been some discussions, PSBs (public sector banks) are encouraged by this idea and they will talk among themselves on how to get this operational,” the official said, adding that the ministry would provide them support if required.