"BMB will be merged with State Bank of India (SBI) to ensure greater banking services outreach to a larger number of women, at a faster pace," an official statement said here.
The objectives of affordable credit to women as well as propagation of women-centric products need to be quickly achieved through a wider network and lower cost of funds, it said.
In the three years since BMB was established, it has extended loans of Rs 192 crore to women borrowers, while the SBI group has provided loans of about Rs.46,000 crore to women borrowers.
SBI has a large outreach of more than 20,000 branches and lowest cost of funds in the sector. Out of the total workforce of around 2,00,000 employees in SBI, 22 per cent are women.
SBI group already has 126 exclusive all-women branches across the country, while BMB has only seven. The proportion of administrative and managerial cost in BMB is much higher to reach the same coverage. For the same cost, a much higher volume of loans to women could be given through SBI.
The Government is committed to enhance the access to financial services to the population at large and women in particular, the statement said.
Under the Pradhan Mantri Jan-Dhan Yojana, preference is given to women for overdraft facility. Pradhan Mantri Mudra Yojana had 73 per cent women borrowers in the previous financial year.
Earlier, the Cabinet had cleared the merger of five associate banks --- State Bank of Bikaner and Jaipur (SBBJ), State Bank of Mysore (SBM), State Bank of Travancore (SBT), State Bank of Hyderabad (SBH) and State Bank of Patiala (SBP) -- with SBI. April one will be the record date for the merger.
After the merger, SBI is set to be among the top 50 large banks of the world. SBI was ranked 52 in the world in terms of assets in 2015, according to Bloomberg, and a merger will see it break into the top 50.