Focus: GS-III Indian Economy
Why in news?
Union Minister of Finance & Corporate Affairs inaugurated Doorstep Banking Services by PSBs and participated in the awards ceremony to felicitate best performing banks on EASE Banking Reforms Index.
- A common reform agenda for PSBs, EASE Agenda, launched in 2018, is aimed at institutionalizing clean and smart banking.
- The subsequent edition of the program ― EASE 2.0 built on the foundation laid in EASE 1.0 and furthered the progress on reforms.
- Reform Action Points in EASE 2.0 aimed at making the reforms journey irreversible, strengthening processes and systems, and driving outcomes.
EASE 3.0 for tech-enabled banking
Ease (Enhanced Access and Service Excellence) 3.0 reform agenda aims at providing smart, tech-enabled public sector banking for aspiring India.
New features that customers of public sector banks may experience under EASE 3.0 reforms agenda include facilities like:
- Palm Banking for “End-to-end digital delivery of financial service”.
- “Banking on Go” via EASE banking outlets at frequently visited spots like malls, stations, complexes, and campuses.
- Digitalizing the experience at public sector bank branches.
- With EASE 3.0, the government is trying to enhance the customer experience with the introduction of features like Dial-a-loan, credit at a click, alternate-data-based lending or other analytics-based credit offers.
- The government aims to focus on digitalization in the Public Sector Banks (PSBs) among themes that include responsible banking, PSBs as Udyami Mitra, customer responsiveness, credit take-off, and deep financial inclusions.
Doorstep Banking Services by PSBs
- As part of the EASE Reforms, Doorstep Banking Services is envisaged to provide convenience of banking services to the customers at their door step through the universal touch points of Call Centre, Web Portal or Mobile App.
- Customers can also track their service request through these channels.
- The services shall be rendered by the Doorstep Banking Agents deployed by the selected Service Providers at 100 centres across the country.
- The services can be availed by customers of Public Sector Banks at nominal charges.
- The services shall benefit all customers, particularly Senior Citizens and Divyangs who would find it at ease to avail these services.
Performance of PSB on EASE 2.0 Index
- PSBs have shown a healthy trajectory in their performance over four quarters since the launch of EASE 2.0 Reforms Agenda.
- Significant progress is seen across six themes of the Reforms Agenda, with the highest improvement seen in the themes of ‘Responsible Banking’, ‘Governance and HR’, ‘PSBs as Udyamimitra for MSMEs’, and ‘Credit off-take’.
- PSBs have adopted tech-enabled, smart banking in all areas, setting up retail and MSME Loan Management Systems for reduced loan turnaround time.
- PSBs have instituted real-time visibility to retail and MSME customers on the status of their loans.
- Most branch-based services are now accessible from home and mobile, including in local languages.
- EASE Reforms Index has equipped Boards and leadership for effective governance, instituted risk appetite frameworks, created technology- and data-driven risk assessment and prudential underwriting and pricing systems, introduced Early Warning Signals (EWS) systems and specialised monitoring for time-bound action in respect of stress, put in place focussed recovery arrangements, and established outcome-centric HR systems.
EASE Reforms Index
- The EASE Reforms Index measures the performance of each PSB on 120+objective metrics across six themes.
- It provides all PSBs a comparative evaluation showing where banks stand vis-à-vis benchmarks and peers on the Reforms Agenda.
- The Index follows a fully transparent scoring methodology, which enables banks to identify precisely their strengths as well as areas for improvement.
- The goal is to continue driving change by spurring healthy competition among PSBs and by encouraging them to learn from each other.
- Progress made by PSBs are tracked quarterly through a published EASE Reforms Index leading up to the annual review.