Country’s largest public sector lender, State Bank of India (SBI) is thinking of taking charges from no-frill account holders for every transaction they conduct to make operation of no-frills accounts opened under the financial inclusion plan possible.
An anonymous senior SBI official involved in its financial inclusion initiatives said that the bank will be taking nominal charge which can be either a percentage of the amount transacted or a fixe amount and this will not discourage people from operating no-frills accounts.
The official said, "The question on our minds is -- how do we make the operations of the model feasible? We can recover the Rs 20,000 required for setting up infrastructure in a village through a kiosk or palm-held device by opening around 100 accounts and charging Rs 200 as account-opening fees."
He said although the plan has not been finalized but people will prefer to pay a small amount like Rs3 for a transaction than travelling 20-kilometres to reach a branch.
He added, "You cannot have a model under which the financial inclusion roll-out is subsidized, it needs to be sustainable."
He told, there are some persistent expenses like maintaining the back-end systems and paying the business correspondent (BC) who is operating on behalf of the branch at the village level, of which bank has to take care.
Bank will do campaigning through multiple media which will help in increasing public interest in being a part of the banking system and assuage any concerns.
Regarding, whether such move will face any regulatory hurdles, the official said, "Though the regulators have given us all the freedom, it is very difficult to say (what their reaction will be)."
Bank financial inclusion plan also includes opening of last mile banking infrastructure at village level to get the local population into the formal banking system.
Earlier this year, in his budget speech Finance Minister Pranab Mukherjee had said that all the 60,000 unbanked villages having a population of over 2,000 will be covered by March 2012, and the public sector banks were allotted these villages.
The banks need funds to invest in traditional brick-and-mortar branches, therefore banks are outsourcing the operations to non-bank financial companies by appointing them as BCs to look after the operations.
Monday, October 25, 2010
Tuesday, October 5, 2010
SBI clerical post receives applications from 3,800 graduate engineers, 200 post graduates
Recently SBI, the country's largest commercial bank gave an advertisement for clerical category. In the advertisement bank had declared vacancy for over 27,000 posts in the clerical cadre, in response to this around 38 lakh aspirants from across the country had applied for the jobs online, 28 lakh of them appeared for the written exam. Out of these 88,000 candidates passed the written exam and 27,000 were selected for an interview.
From the selected 27,000 candidates, 3,800 are graduate engineers, 200 are post graduates in different branches of engineering, 8,200 are women and 2,000 are ex-servicemen.
A senior SBI official was surprised to see such a response from technically qualified candidates said, "It was the biggest such exercise for us. The response to our advertisement was huge. It took a little longer to complete the selection process."
After the global economic crisis, though the job market has picked up still it does not seem to be that favorable for aspiring candidates. The young and potential candidates are finding difficulty in getting job which has led them to rethink about their career. An engineering graduate said, "I come from a leading engineering college. When I applied for the SBI job, there were virtually no vacancies in the manufacturing or IT sector due to recession. I had to seriously look at other options. After all, SBI offers a safe job."
An HR professional who was shocked to see engineering graduates taking up clerical assignments said, "The country boasts of having a large number of engineering colleges. However, it does appear that we are producing engineers without accessing the manpower requirement."
From the selected 27,000 candidates, 3,800 are graduate engineers, 200 are post graduates in different branches of engineering, 8,200 are women and 2,000 are ex-servicemen.
A senior SBI official was surprised to see such a response from technically qualified candidates said, "It was the biggest such exercise for us. The response to our advertisement was huge. It took a little longer to complete the selection process."
After the global economic crisis, though the job market has picked up still it does not seem to be that favorable for aspiring candidates. The young and potential candidates are finding difficulty in getting job which has led them to rethink about their career. An engineering graduate said, "I come from a leading engineering college. When I applied for the SBI job, there were virtually no vacancies in the manufacturing or IT sector due to recession. I had to seriously look at other options. After all, SBI offers a safe job."
An HR professional who was shocked to see engineering graduates taking up clerical assignments said, "The country boasts of having a large number of engineering colleges. However, it does appear that we are producing engineers without accessing the manpower requirement."
SBI and Western Union tie-up for mobile money transfer in India
State Bank of India (SBI), the largest commercial bank in India has signed an agreement with Western Union, may be the largest money transfer service to India, to offer cross border money transfers service to SBI account holders on their mobile phones. Anil Kapur, Western Union’s Senior VP (South and Southeast Asia), said India is the world’s No. 1 remittance recipient country. According to World Bank figures in 2009 the received figure stood at US$52 billion. At present, consumers through 70,000 Western Union Agent located in 25 countries will be able to send Mobile Money Transfers.
In India, there are 61,000 agent locations of Western Union with the mobile transfer partnership it will be able to expand its distribution within India using SBI’s network. However Western Union is already partnered with SBI, at over 12,000 SBI branches Western Union Money Transfer service is available. With this partnership, SBI customers will be able to transfer money from Western Union into their accounts, using mobile phones, online banking, ATMs and bank branches. In July, Western Union made an announcement in early 2011the Account-Based Money Transfer (ABMT) service will be introduced which will be enable SBI customers with online bank accounts to draw a Western Union Money Transfer directly into their accounts via the Internet or an ATM. According to the release, there are 110 million SBI accountholders, out of which more than 4 million are registered for online banking.
Western Union is offering the Mobile Money Transfer service in many other parts of the world including the Philippines with Smart Communications and Globe Telecom; in Kenya with Safaricom; in Malaysia with Maxis and in South Africa with Absa Bank. Recently company has tied-up with EnStream in Canada and has agreements with Tunisian Post and Bank of Commerce & Development (BoCD) in Libya. Besides this, Western Union had earlier announced tie up with Zain (now owned by Airtel) in Africa.
In India, there are 61,000 agent locations of Western Union with the mobile transfer partnership it will be able to expand its distribution within India using SBI’s network. However Western Union is already partnered with SBI, at over 12,000 SBI branches Western Union Money Transfer service is available. With this partnership, SBI customers will be able to transfer money from Western Union into their accounts, using mobile phones, online banking, ATMs and bank branches. In July, Western Union made an announcement in early 2011the Account-Based Money Transfer (ABMT) service will be introduced which will be enable SBI customers with online bank accounts to draw a Western Union Money Transfer directly into their accounts via the Internet or an ATM. According to the release, there are 110 million SBI accountholders, out of which more than 4 million are registered for online banking.
Western Union is offering the Mobile Money Transfer service in many other parts of the world including the Philippines with Smart Communications and Globe Telecom; in Kenya with Safaricom; in Malaysia with Maxis and in South Africa with Absa Bank. Recently company has tied-up with EnStream in Canada and has agreements with Tunisian Post and Bank of Commerce & Development (BoCD) in Libya. Besides this, Western Union had earlier announced tie up with Zain (now owned by Airtel) in Africa.
Friday, October 1, 2010
SBI raises deposit rates by 25-75bps, base rate remain unchanged
Country’s largest lender State Bank of India (SBI), has revised its deposit rates but has not changed the base rate the minimum rate of interest on loans is at 7.5%. Bank has raised deposit rates by 25 to 75 basis points (bps), ranging from 4 percent to 7.75percent.
The SBI said in a statement, “The bank revises upwards the deposit rates by 25-75 bps in various maturities, effective from Oct 1.”
Bank has raised deposit rates by 75 basis points to 5.5percent per annum on term deposits from 91 days to 180 days maturity period.
While on the maturity period of 556 days to less than 2 years rate has been increased by 50 basis points to 7.25 percent. For maturity period from 2 years to 999days interest rate has been increased to 7.50 per cent from existing 7 per cent and on 1,000 days maturity bank has raised interest rate by 50 basis points to 7.75 per cent.
For 1 year to 554 days the rates have been increased by 25 basis points to 7 percent, whereas on 555 days the rates have been raised by 25 basis points to 7.5 per cent and on 1,001 days to less than 3 years bank is offering revised rate of 7.15 percent.
For other maturity period’s bank has not kept rates unchanged.
Bank in its quarterly review of base rate said, “Base rate will continue to remain 7.50 percent per annum for the present.”
Although, last month SBI had raised benchmark lending rate by 50 basis points and deposit rates by 25 to 150 basis points.
The SBI said in a statement, “The bank revises upwards the deposit rates by 25-75 bps in various maturities, effective from Oct 1.”
Bank has raised deposit rates by 75 basis points to 5.5percent per annum on term deposits from 91 days to 180 days maturity period.
While on the maturity period of 556 days to less than 2 years rate has been increased by 50 basis points to 7.25 percent. For maturity period from 2 years to 999days interest rate has been increased to 7.50 per cent from existing 7 per cent and on 1,000 days maturity bank has raised interest rate by 50 basis points to 7.75 per cent.
For 1 year to 554 days the rates have been increased by 25 basis points to 7 percent, whereas on 555 days the rates have been raised by 25 basis points to 7.5 per cent and on 1,001 days to less than 3 years bank is offering revised rate of 7.15 percent.
For other maturity period’s bank has not kept rates unchanged.
Bank in its quarterly review of base rate said, “Base rate will continue to remain 7.50 percent per annum for the present.”
Although, last month SBI had raised benchmark lending rate by 50 basis points and deposit rates by 25 to 150 basis points.
Tuesday, September 21, 2010
SBI opens exclusive branch for corporate salary accounts in Hyderabad
Country’s largest lender the State Bank of India (SBI) is on the move to target special class of the society. Two weeks ago the bank had opened a special branch for high networth individuals, this week on Monday bank launched an exclusive branch for corporate salary accounts at the DLF Cyber Centre at Gachibowli in Hyderabad.
Through this, the bank aims to target mainly the IT and engineering companies which are concentrated around Gachibowli. At this branch full range of services will be available including deposit, loan, insurance, mutual funds and Internet banking.
The branch was inaugurated by Shiva Kumar, chief general manager of SBI (Hyderabad circle), on the occasion he said, bank is expecting to open net 3,000 to 4,000 accounts by March 2011.
He added, “As the DLF premises get occupied to its 16,000-person capacity, the branch will have the first mover advantage in gaining their accounts. We will also consider extending our working hours to suit the 24-hour schedules of the IT industry.”
This branche will offer corporate salary account package in four variants including anywhere banking, zero minimum balance, free Internet banking as well as concessions on interest and processing fee on loans, and on remittance and maintenance charges on demat and eZ trade accounts.
Kumar told at present seven employees have been positioned in the branch, gradually number of employees will be increased, and, added more such branches might be opened in other parts of the state.
The branch also has a Finmart lounge where customers can comfortable sit and discuss products besides carrying out their routine transactions. Other services to be offered at branch include financial planning, advisory services and financial wellness camps.
The other facilities to be provided of particular interest of the targeted class customers will include e-tax, demat and online trading, and e-Invest for ASBA (Application Supported by Blocked Amounts) facility, where an IPO applicant’s account doesn’t get debited until shares are allotted to him.
Through this, the bank aims to target mainly the IT and engineering companies which are concentrated around Gachibowli. At this branch full range of services will be available including deposit, loan, insurance, mutual funds and Internet banking.
The branch was inaugurated by Shiva Kumar, chief general manager of SBI (Hyderabad circle), on the occasion he said, bank is expecting to open net 3,000 to 4,000 accounts by March 2011.
He added, “As the DLF premises get occupied to its 16,000-person capacity, the branch will have the first mover advantage in gaining their accounts. We will also consider extending our working hours to suit the 24-hour schedules of the IT industry.”
This branche will offer corporate salary account package in four variants including anywhere banking, zero minimum balance, free Internet banking as well as concessions on interest and processing fee on loans, and on remittance and maintenance charges on demat and eZ trade accounts.
Kumar told at present seven employees have been positioned in the branch, gradually number of employees will be increased, and, added more such branches might be opened in other parts of the state.
The branch also has a Finmart lounge where customers can comfortable sit and discuss products besides carrying out their routine transactions. Other services to be offered at branch include financial planning, advisory services and financial wellness camps.
The other facilities to be provided of particular interest of the targeted class customers will include e-tax, demat and online trading, and e-Invest for ASBA (Application Supported by Blocked Amounts) facility, where an IPO applicant’s account doesn’t get debited until shares are allotted to him.
Thursday, September 16, 2010
SBI opens branches at kirana stores
State Bank of India (SBI), country’s largest lender is offering banking services through kiosks branches set up at kirana stores. At these branches you can open an account, deposit cash, withdraw or transfer money and will get a ‘pakka’ receipt for it.
SBI is offering this service in partnership with pre-paid services provider Oxigen Services - a bill payment, mobile recharge and ticketing systems provider.
The bank has opened the first 50 kiosks in Mumbai, including one in Dharavi and will be opening around 1,000 more in the city and another 870 across the state.
According to bank sources 30 kiosks branches have also been opened in Delhi. In Bihar and UP kiosks will start operation by October 2010.
Soon other banks will start offering such service.
The SBI kiosk will offer banking services in six languages.
To open an account at the selected kirana stores a person need to carry a photo ID and address proof. The account will be a no-frills account, where to maintain a minimum balance is not mandatory. The shopkeeper will take a photo of the person using a webcam and also fingerprints with a biometric device.
Pramod Saxena, managing director and chairman at Oxigen said, “The know-your-customer verification process is diluted here; the regular KYC is so stringent that daily wage earners and migrants get excluded from banking facilities.”
If a person who wants to open an account does not have an address proof, then he can get a letter from the mukhiya of his native place or letter from employer stating the place of stay, will serve as address proof. No personal verification will be done as done for a regular bank account and the fingerprints will serve as the main identification.
At a regular SBI bank branch the cost of opening an account comes to Rs400 but at these kiosks branches the cost will be as low as Rs20.
The limit of deposit of cash or withdrawal at these kiosks is up to Rs 10,000 per day, while the total balance in any account can not cross Rs 50,000 at any given point.
There will be no charges for cash deposit but for withdrawal you will have to pay Rs 25 per transaction if it is done at kiosks other than one where you have opened an account.
The money can be transferred from kirana account to the regular SBI account, but you cannot access kirana account through a bank branch.
At present the SBI bank customers having regular savings account cannot access banking through kirana stores.
Gradually micro loans, insurance and remittance will be offered to these account holders.
Riten Ghose, general manager, Mumbai at SBI said, “Through the Dharavi microfinance branch we will be financing Rs50 crore by March 2011.”
Soon other banks follow the path and more kirana stores start offering banking services.
An Oxigen official pointed out, “Other banks, private included have been approaching us. But at least for the next couple of months we do not want to sign on any other bank.”
However Oxigen is offering other services such as bill payments, railway ticket booking, mobile recharge and DTH payments through 20,000 web kiosks and, now banking service has been added to the same network.
Monday, September 6, 2010
State Bank of Patiala opens seven branches in different districts of Punjab
State Bank of Patiala, a public sector lender headquartered in Patiala has opened seven brick and mortar branches in its Bathinda and Jalandhar zones with an aim to provide banking facility to the rural people of Punjab. The new branches have been opened in the districts of Ludhiana, Jalandhar, Hoshiarpur and Amritsar.
Bank managing director Ashok Nayar, told, bank is planning to open 20 branches in the identified villages which will be covered under the financial inclusion drive. Out of these, 11 branches will be opened in Punjab and nine in other states of India. The branches to be opened in the villages under financial inclusion program are provided by the lead bank under the guidelines of Reserve Bank of India.
Through these branches bank will be providing loan and banking facilities to the rural people. The bank is proposed to cover 500 villages during the current year under Financial Inclusion, out of which these 263 villages will be of Punjab. In rest of the villages bank will provide services through business correspondents.
Banks has done all the arrangements for this and the services will be rolled out in the next month. By 30th September, 2010 bank is likely to cover over 150 villages under the financial inclusion program.
According to RBI directives, any village with a population of over 2000 households has to be covered under financial inclusion.
Nayar emphasized that loan should be used for productive purpose also the repayment should be done timely as it will help in recycling the money which is a must for the growth of the economy and the nation. He said people should avail facility of free counseling available at the Financial Literacy and Credit Counseling cell known as Lead Bank opened at Mini Secretariat Bhatinda. The FLCC is providing counseling on responsible borrowing, banking terminologies and restructuring of irregular loans.
Bank managing director Ashok Nayar, told, bank is planning to open 20 branches in the identified villages which will be covered under the financial inclusion drive. Out of these, 11 branches will be opened in Punjab and nine in other states of India. The branches to be opened in the villages under financial inclusion program are provided by the lead bank under the guidelines of Reserve Bank of India.
Through these branches bank will be providing loan and banking facilities to the rural people. The bank is proposed to cover 500 villages during the current year under Financial Inclusion, out of which these 263 villages will be of Punjab. In rest of the villages bank will provide services through business correspondents.
Banks has done all the arrangements for this and the services will be rolled out in the next month. By 30th September, 2010 bank is likely to cover over 150 villages under the financial inclusion program.
According to RBI directives, any village with a population of over 2000 households has to be covered under financial inclusion.
Nayar emphasized that loan should be used for productive purpose also the repayment should be done timely as it will help in recycling the money which is a must for the growth of the economy and the nation. He said people should avail facility of free counseling available at the Financial Literacy and Credit Counseling cell known as Lead Bank opened at Mini Secretariat Bhatinda. The FLCC is providing counseling on responsible borrowing, banking terminologies and restructuring of irregular loans.
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