 "SBI Building, SBI")
State Bank of India (SBI) has sanctioned around 20,000 loans of Rs 10 lakh to Rs 50 lakh for small businesses as part of a digital lending pilot that started in December, a senior official said on Friday.
Having been satisfied with the results of the pilot, under which a customer can get a loan sitting at home, the country's largest lender is now broadening the loan amounts to Rs 5 crore, Deputy Managing Director Surendra Rana said at a banking conference organised by IMC here.
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"We rolled out the Rs 10-50 lakh model in December and I am happy to share that we have already sanctioned around 20,000 loans through this process and this is working very smoothly. Now, we are escalating it to Rs 5 crore," he said.
A customer journey starts with scanning a QR code from anywhere, grants some approvals and SBI uses data repositories to come back with a sanctioned amount in a maximum of five days, he said.
The remarks from the official come days after the bank announced that lending to small businesses will be a "focal point" for its growth and profits over the next five years.
Rana said banks have been partnering with governments, non-profits, and fintechs for deepening their reach for small businesses' credit needs.
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Even though a lot of successes have been achieved on the financial inclusion front, he said there are some challenges as well like the diverse geography, limited financial literacy, and social and cultural constraints that banks need to grapple with, he said.
He said SBI services 16 crore of the 52 crore Prime Minister Jan Dhan Yojana accounts opened since 2014.
Financial inclusion as a phrase has gone beyond mere opening of bank accounts and now encompasses serving credit, helping the customer get an insurance cover, etc, he said.
He also appreciated the work done by the RBI on the financial inclusion front, and pointed to the regulatory sandbox for testing future solutions as an under-appreciated aspect.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
