NEW DELHI: Nirmala Sitharaman, the Finance Minister, said on Sunday that banks, including the private sector, should embrace digitization to ensure that government initiatives reach the poor and oppressed and adopt financial inclusion for a broader reach. Speaking at the centenary celebrations of the city-based Tamilnad Mercantile Bank, she said the government’s cash payments were provided to the needy after confirming their details using digitalization through banking correspondents even during the Covid-19 pandemic.
“Prime Minister (Narendra Modi) understood the importance of banking and did not hesitate to say that the people could open accounts with zero balance under the Jandhan Yojana scheme (launched in 2014). However, he stipulated that everyone must have a bank account and be able to conduct transactions using a RuPay card,” she explained.
She claimed that during the Covid-19 outbreak, the government paid Rs 1,500 to the needy through their bank accounts in three instalments and that digitalization is causing a lot of changes in the banking industry at a “rapid speed.” It is not necessary to open a branch in a location where there is no bank. All kinds of technology are now available to reach the bank account of the people who live there.
Financial technology is the most crucial area nowadays, and we can use it to input data into forms. It could be a matter of income tax or GST. Auto-populating data (from a customer) has proven to be valuable (today). Auto-populating data is only possible through ‘digitization,’ and TMB’s management should consider expanding its usage of digitization. The banking industry has a lot of potentials. I believe digitalization must be fully integrated. For the sake of your good and that of your clients, you cannot ignore digitization,” she added, adding that TMB should onboard all of its customers and promote Financial Inclusion.
She presented a cheque to a beneficiary of the Tamilnad Mercantile Bank’s ‘PM Svanidhi scheme. Sitharaman further said, “Today you are presenting a cheque to a woman who runs a business selling ‘idlies’ in her pushcart, you can distribute the financial assistance because there is a scheme like PM Jandhan Yojana” (financial inclusion scheme).
The “priority” sector accounted for 74 per cent of Tamilnad Mercantile Bank’s activity, allowing the bank to grow into rural areas. During the Covid-19 epidemic, the Centre launched the Emergency Credit Guarantee Liquidity Scheme to enable MSMEs to operate without having to collect any additional collateral required, she added.