Banks have opportunity to tap into rural sector in post-Covid world: Ghosh

Private lender Bandhan Bank on Friday said banks will have an opportunity to tap the rural sector in the post Covid-19 scenario, as the pandemic has not severely effected its economy.

"The future opportunity lies in the hinterland. The rural economy is less affected. Banks, including Bandhan, would like to focus on enterprises that have a good network in rural areas," MD and CEO of Bandhan Bank Chandrasekhar Ghosh said.

Bandhan Bank has already disbursed around Rs 3,500 crore in rural locations last month, Ghosh said during a webinar organised by the MCCI.

The lenders' collection efficiency ratio has increased considerably, which shows people are willing to repay loans, he said.

MSMEs, which contribute to the supply chain, also present a potential opportunity for banks going ahead, he said.

Ghosh said banks are at present flush with funds and credit offtake is slow, and there is a need to mobilise deposits.

He said Bandhan Bank has made sufficient provisioning against risks which might surface after the moratorium period is over at the end of August.

The lender will also start opening online accounts from next month, he said.