"We have given top priority to ensure that banking services reach the last mile"
"A whole new world of possibilities opens up when financial partnerships are combined with digital partnerships"
"Today the number of branches per one lakh adult citizens in India is more than countries like Germany, China and South Africa"
"The IMF has praised India's digital banking infrastructure"
"The World Bank has even gone so far as to say that India has become a leader in ensuring social security through digitization"
"Banking today has gone beyond financial transactions and has also become a medium of 'Good Governance' and 'Better Service Delivery'"
"If Jan Dhan accounts had laid the foundation of financial inclusion in the country, then Fintech would form the basis of financial revolution"
"Today the entire country is experiencing the power of Jan Dhan Bank accounts"
"The economy of any country is as progressive as its banking system is strong"
Deploying technology to achieve development goals is a hallmark of our Government, says Smt. Sitharaman
DBUs an enabler in digital ecosystem, to improve customer experience by facilitating seamless banking transactions: RBI Governor
The Prime Minister, Shri Narendra Modi dedicated 75 Digital Banking Units (DBU) across 75 districts to the nation via video conferencing.
Addressing the gathering, the Prime Minister started by stressing that the 75 Digital Banking Units (DBU) will further financial inclusion and enhance banking experience for citizens. "DBU is a big step in the direction of Ease of Living for the common citizens", he said. The Prime Minister informed that in such a banking setup, the government aims to provide maximum services with minimum infrastructure, and all of this will happen digitally without involving any paperwork. It will also simplify the banking procedure while also providing a robust and secure banking system. "People living in small towns and villages will find benefits like transferring money to availing loans. Digital Banking Units are another big step in that direction which is going on in the country to make the life of common man of India easier", he added.
The Prime Minister said that the aim of the government is to empower the common citizen and make them powerful, and as a result, policies were made keeping in mind the last person and the entire government moving in the direction of their welfare. He pointed out the two areas on which the government worked simultaneously. First, reforming, strengthening, and making the banking system transparent, and secondly financial inclusion.
Recalling the traditional ways of the past where people had to go to the bank, the Prime Minister said that this government transformed the approach by bringing the bank to the people. "We have given top priority to ensure that banking services reach the last mile", he said. A huge change from the days when it was expected that poor will go to the bank to a scenario when the banks were going on the doorstep of the poor. This involved reduction of distance between the poor and the banks. "We not only removed the physical distance but, most importantly, we removed the psychological distance." Highest priority was given to cover far flung areas with banking. The Prime Minister informed that today more than 99 percent of villages in India have a bank branch, banking outlet or a 'banking mitra' within 5 km radius. "Extensive Post Office network too was harnessed via India Post Banks for providing the banking needs to the common citizens", he said. "Today the number of branches per one lakh adult citizens in India is more than countries like Germany, China and South Africa", he added.
Despite initial misgivings in certain sections, the Prime Minister said, "today the entire country is experiencing the power of Jan Dhan Bank accounts." He informed that these accounts enabled the government to provide insurance to the vulnerable at a very low premium. "This opened the way for loans for the poor without collateral and provided Direct Benefit Transfer to the accounts of the target beneficiaries. These accounts were the key modality for providing homes, toilets, gas subsidy, and benefits of schemes for farmers could be ensured seamlessly", he said. The Prime Minister acknowledged the global recognition for India's digital banking infrastructure. "The IMF has praised India's digital banking infrastructure. The credit for this goes to the poor, farmers and labourers of India, who have adopted new technologies, made it a part of their lives", he emphasised.
"UPI has opened up new possibilities for India," the Prime Minister continued, "When financial partnerships are combined with digital partnerships, a whole new world of possibilities opens up. A huge example like UPI is before us. India is proud of this as it is the first technology of its kind in the world." He informed that today 70 crore indigenous Rupay cards are in operation, a vast change from the days of foreign players and the elite nature of such products. "This combination of technology and economy is enhancing the dignity and affordability for the poor and empowering the middle class, while at the same time it is also eliminating the digital divide of the country", he said. He also praised the role of DBT in eliminating corruption and said that more than 25 lakh crore rupees have been transferred in various schemes via DBT. He informed that he will transfer the next instalment to the farmers tomorrow. "Today the whole world is appreciating this DBT and the digital power of India. Today it is being seen as a global model. The World Bank has even gone so far as to say that India has become a leader in ensuring social security through digitization", said the Prime Minister.
The Prime Minister informed that fintech is at the heart of India's policies and efforts, and it is playing a key role in shaping the future. Digital banking units will further expand this capability of fintech. "If Jan Dhan accounts had laid the foundation of financial inclusion in the country, then Fintech would form the basis of financial revolution", he said.
Referring to the government's announcement of the launch of a digital currency based on blockchain technology, the Prime Minister pointed out that "Be it digital currency in the coming times, or digital transactions in today's time, apart from the economy, many important aspects are associated with them". He listed the savings, elimination of the hassle of physical currency and environmental benefits as key advantages. The Prime Minister pointed out that paper and ink for currency printing are imported, and by adopting a digital economy we are contributing to a self-reliant India while also benefiting the environment by reducing the consumption of paper.
The Prime Minister pointed out that banking today has gone beyond financial transactions and has also become a medium of 'Good Governance' and 'Better Service Delivery'. Today, this system has given rise to immense possibilities for growth for the private sector and small-scale industries as well. He further added that there is hardly any area in India in which product and service delivery through technology is not creating a new startup ecosystem. "Digital economy today is a great strength of our economy, of our startup world, of Make in India and of self-reliant India", he said. "Today our small industries, our MSMEs are also participating in government tenders through a system like GEM. They are getting new business opportunities. So far, orders worth Rs 2.5 lakh crore have been placed on GEM. Many more new opportunities will now arise in this direction through digital banking units", he added.
"The economy of any country is as progressive as its banking system is strong", the Prime Minister remarked. He informed that the country has shifted from the pre-2014 'phone banking' system to digital banking in the last 8 years, and as a result, India's economy is moving forward with a continuum. Recalling the old ways, the Prime Minister pointed out that before 2014, the banks used to get phone calls to decide their functioning. He further added that phone banking politics had made the banks unsafe and made the country's economy insecure by sowing the seeds of thousands of crores of scams.
Throwing light on how the present government had transformed the system, the Prime Minister informed that transparency has been the main focus. He continued, "After bringing transparency in the identification of NPAs, lakhs of crores of rupees were brought back into the banking system. We recapitalized banks, took action against willful defaulters, and reformed the Prevention of Corruption Act." He further noted that the resolution of NPA-related issues was expedited with the help of IBC while promoting the use of technology and analytics for loans, for the creation of a transparent and scientific system. "Decisions such as the merger of banks were victims of policy paralysis and the country took them boldly. The results of these decisions are before us today", he added. He informed that a new self-driven mechanism is now being created for the banking system through new initiatives like digital banking units and innovative use of Fintech. There is as much autonomy for the consumers, there is also the same convenience and transparency for the banks, he said while asking the stakeholders to take the movement further.
In concluding his address, the Prime Minister urged the small business owners from villages to completely move towards digital transactions. He also urged banks to connect 100 merchants with them for going totally digital for the benefit of the country. "I am sure, this initiative will take our banking system and economy to a stage which will be future-ready, and will have the capability to lead the global economy", Shri Modi concluded.
In her address on the occasion, Union Minister for Finance & Corporate Affairs Smt. Nirmala Sitharaman said that during Amrit Kaal, honourable Prime Minister, honouring your vision for greater use of technology and getting digital banking into India, the Scheduled Commercial Banks are establishing 75 Digital Banking units (DBUs) in 75 districts of our country.
Smt. Sitharaman, while participating in the launch via video conference from Washington DC, said that DBUs will enable people who do not have a personal computer, who do not have a laptop, or do not have even a smartphone, to be able to access banking services. They can do it digitally in a paperless mode. For those who are not even tech savvy, there is a mode where they can be facilitated to avail of these paperless services.
The Finance Minister said that deploying technology to achieve development goals is the hallmark of our Government.
Smt. Sitharaman said, "As Reserve Bank Governor also explained, paperless operations will be available 24x7. Even cash deposit facilities or opening of a deposit of fixed deposit or recurring deposits, one can avail of all these services. Government's credit link schemes through the Jan Samarth portal will also be available for ordinary users, MSME and retail loan users can benefit out of it."
As was explained, the Union Finance Minister said, financial literacy can be promoted through these DBU units. Financial inclusion and digital banking go another mile in achieving greater digitising and formalising of Indian economy. "I urge all the representatives who are present here today to spend at least some time each day to promote literacy, financial literacy, digital education for the bank customers and for all those business units which are small in your neighbourhood, Smt. Sitharaman said.
The Finance Minister said, "Popularising digital banking is important, so the most important aspect is that it is going to be cost effective for the consumer and it is going to be absolutely safe and secure for them to use it. These thoughts will have to be promoted by the bank agents, meaning banking agents, banking correspondent bank managers and all officials so that greater formalisation of the Indian economy can be achieved."
Congratulating the RBI and the Indian Bank Association for very speedy documenting this in a very efficient manner, Smt. Sitharaman said that the DBUs will go a long way in giving further and faster digital banking in India and help our economy to move towards a cashless and inclusive economy.
On the ocassion, RBI Governor Shri Shaktikanta Das in his address said that this is indeed a historic occasion when 75 Digital Banking Units (DBUs) are being dedicated to the service of the nation by the Prime Minister at a time when we are celebrating 'Azadi Ka Amrit Mahotsav'. This is a joint initiative of the Government, the RBI, the Indian Banks Association and the participating banks.
In recent years, the RBI Governor said, digital banking has emerged as a preferred channel for delivering banking services in the country. The Reserve Bank has been taking progressive measures to improve availability of digital infrastructure for banking services. Following the announcement made in the Union Budget 2022-23 for setting up of 75 DBUs, the RBI issued the required guidelines after consulting the Indian Banks Association and other experts in the field.
Shri Das noted that the commercial banks – both in the public and private sectors – have responded very positively to this initiative. 75 DBUs have been set up in record six months' time in 75 districts of the country to commemorate 75 years of our independence.
Shri Das said that DBUs will act as an enabler in the digital ecosystem and will improve customer experience by facilitating seamless banking transactions as also augment our efforts to promote financial inclusion by providing banking services in a paperless, efficient, safe and secure environment.
The RBI Governor further said, the specific financial services to be provided by the DBUs include, among other things, savings, credit, investment and insurance. On the credit delivery front, to start with, the DBUs will provide end-to-end digital processing of small ticket retail and MSME loans, starting from online applications to disbursals.
Shri Das said, "The DBUs will also provide services related to certain identified government sponsored schemes. The products and services in these Units will be provided in two modes, namely, self-service and assisted modes, with self-service mode being available on 24*7*365 basis. The banks are also free to engage the services of digital business facilitators and business correspondents to expand the footprint of the DBUs."
The function was attended by Union Finance Minister; Chief Ministers; Union and State Ministers; Governor, RBI; LGs; MPs and MLAs; Secretaries and other senior officials from Government of India. MD & CEOs, officials of Banks & other public representatives also attended the event from various DBUs across the country. All the officials posted at the 75 DBUs were also connected during the event.
ABOUT DIGITAL BANKING UNITS (DBUs)
The DBUs will enable those who do not have ICT infrastructure to access banking services digitally. They will also assist those who are not tech savvy to adopt digital banking. In DBU, the products and services will be offered to customers in 2 modes:
- Self Service Mode
- Digital Assistance Mode
DBUs will be different from traditional branch in following aspects:
- They will provide banking services including cash deposit & withdrawal 24 x 7.
- Services shall be provided digitally.
- People not having connectivity or computing devices can do banking transactions from DBU in a paperless mode.
- Bank staff will be available to help and guide users for banking transactions in assisted mode
- Will help in providing digital financial literacy and create awareness for adopting digital banking.
Services being offered through DBU include banking facilities like opening of savings account, balance-check, print passbook, transfer of funds, investment in fixed deposits, loan applications, stop-payment instructions for cheques issued, application for credit / debit cards, view statement of account, pay taxes, pay bills, make nominations, etc. The DBUs will also facilitate onboarding to Government credit link schemes through the Jan Samarth portal and end-to-end digital processing of a small ticket MSME/retail loans.
BACKGROUND
In yet another measure to deepen financial inclusion, the Prime Minister, Shri Narendra Modi dedicated 75 Digital Banking Units (DBUs) to the nation via video conferencing.
As part of the Union budget speech for 2022-23, the Finance Minister announced setting up the 75 DBUs in 75 districts to commemorate our country's 75 years of independence. The DBUs are being set up with the objective to ensure the benefits of digital banking reach every nook and corner of the country and will cover all the States and Union territories. 11 Public Sector Banks, 12 Private Sector Banks and one Small Finance Bank are participating in the endeavour.
DBUs will be brick-and-mortar outlets which will provide a variety of digital banking facilities to people such as opening savings accounts, balance-check, print passbooks, transfer of funds, investment in fixed deposits, loan applications, stop-payment instructions for cheques issued, applying for credit/debit cards, view statement of account, pay taxes, pay bills, make nominations, etc.
DBUs will enable customers to have cost-effective, convenient access and enhanced digital experience of banking products and services throughout the year. They will spread Digital Financial Literacy and special emphasis will be given to customer education on cyber security awareness and safeguards. Also, there shall be adequate digital mechanisms to offer real-time assistance and redress customer grievances arising from business and services provided by the DBUs directly or through Business Facilitators/ Correspondents.
CLICK HERE to access the list of Digital Banking Units (DBUs).
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