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Finance Minister requests that banks be more customer-friendly

Finance Minister Nirmala Sitharaman stated on Monday that banks must be more customer-friendly in order to make loans more accessible.

Ms. Sitharaman stated this at a post-budget session with industry officials in Mumbai, while also emphasizing that banks are not required to be flexible on credit underwriting criteria by assuming any unfavorable risks on a proposal.

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During the meeting, a start-up representative suggested that credit be made easily available, to which State Bank of India chairman Dinesh Kumar Khara responded that a startup’s concerns are more on the equity side and guaranteed complete assistance in lending provided adequate equity is on the table.

Ms. Sitharaman, emphasizing that the person asking the question is a woman running an innovative business, made a few ideas for the financial community and also spoke out against their attitude.

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Mr. Khara first provided a bland response. He then went on to explain about a plan that has a lot of government support, the credit guarantee fund trust for micro and small businesses (CGTMSE), she claimed.

Banks will need to become much more customer-friendly. Not to the point of taking risks, you do not need to take, but you need to be a lot friendlier to clients, according to the minister.

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Mr. Khara stated that the emphasis is on growing dependence on end-to-end digitization of the process to offer a hassle-free experience.

He stated that the bank will become totally digital for lending within the next two months. Furthermore, if a bank has reliable cash flow visibility, lending growth to small enterprises can eventually rival that of personal loans.

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Finance Minister Nirmala Sitharaman also stated on Monday that the government is looking for long-term economic recovery and that the budgetary recommendations for infrastructure development are an attempt to generate a multiplier effect that would push growth.

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