One of the key points emphasised by FM Sitharaman was the need to improve the Current and Savings Account (CASA) Ratio of RRBs. She highlighted that although the CD Ratio, Gross NPAs, and Provision Coverage Ratio (PCR) of RRBs in the Southern region were already better than the national average, enhancing CASA Ratio would bolster their financial stability and enhance their capacity to extend credit to various sectors.
To achieve this goal, FM Sitharaman urged RRBs to embrace greater digitalisation and focus on increasing the number of digitally active customers. This aligns with the government’s broader effort to move towards a more digital economy.
She stressed that adopting technology, Loan Management System, and Core Banking System should be prioritised in a time-bound manner.
The Finance Minister also urged Sponsor Banks to strengthen their ties with RRBs by mapping them with Micro, Small, and Medium Enterprises (MSME) clusters and enhancing their presence in these clusters. By doing so, they can devise innovative financial products tailored to the needs of MSMEs and better serve this critical sector.
Additionally, FM Sitharaman encouraged RRBs to leverage the Account Aggregator Framework for lending to the Allied agricultural sector, including fisheries, animal husbandry, and street vendors under PM SVANidhi.
The meeting was attended by Secretary of the Department of Financial Services, along with senior officials from the Reserve Bank of India (RBI). Representatives from the Finance Departments of Tamil Nadu, Andhra Pradesh, Telangana, Kerala, Puducherry, and Karnataka were also present.
The MDs and CEOs of prominent banks like State Bank of India, Indian Bank, Union Bank of India, Canara Bank, Indian Overseas Bank, and NABARD also participated in the discussions.
