Commerce without morality.. one of the deadly sins..!

New Delhi, April 12: “Banks are no longer just about strong lockers and a good interest rate on deposits. They have transcended their conventional mandates and are now at the forefront of India's development story”, said Vice President M Venkhaiah Naidu while addressing the intellectuals at the 125th foundation day of the state owned corporation Punjab National Bank at new Delhi today.

  

Calling for ‘Antyodaya’, he stated that development held no meaning until its benefits reached the most deprived groups of people. Further stressing at the systemic reforms in the Indian banking sector in light of mounting Non Performing Assets (NPAs), he spoke of the need to have an effective and efficient system of checks and balances in place so that the loop holes in the system are not taken advantage of.

“India’s financial institutions have been commended globally for being resilient and for having withstood global downturns and recessions well. Banks played a central role in India’s quest for financial inclusion and inclusive growth. India’s banking sector is poised for robust growth as the rapidly growing business and commerce in India turn to banks for credit and other financial services”, he added.

Citing the gains made by India in digital technologies for banking such as India’s Immediate Payment Service (IMPS), RuPay and the Unified Payment Interface (UPI), and the Bharat Interface for Money (BHIM), a mobile app based on UPI, the Vice President asked banks to further harness digital growth to scale up to the level of world-class businesses.

Naidu further pointed towards a number of challenges being faced by the banking industry such as the rising Non Performing Assets in the banking system that has the capacity to affect banks’ lending capabilities. “Accumulation of bad loans happened over a long period of time, and now, it threatens to hamper economic growth by weakening the credit supply channel of the economy”, he added.

Instructed banks to maintain strict vigilance during pre and post sanction procedures of loans, the Vice President told them to never make compromises in the due diligence processes. “Banks must constantly strengthen their internal processes to effectively monitor funds and maintain strict discipline in lending”, he added.

Saying that this was a period of disruptions in the banking sector caused due to factors ranging from technology to innovative new business models, he signed off urging the banks to make bold moves and initiate major transformations to take advantage of them.