Gyan Sangam, a two-day conference aimed at reforming the Indian banking sector, was inaugurated today by Jayant Sinha, Minister of State for Finance, in Pune.
Pitched as the first step towards creating a new banking paradigm, the conference is being attended by regulators, officials of the Finance Ministry, and the top management of all public sector banks (PSBs), insurance companies and financial institutions (FIs). Speaking at the event Sinha asked PSU banks to be socially responsible while ensuring their commercial viability.
“Though this is a Government of the poor...it is also a pro-business Government. So, the trade-off has to be managed by ensuring that the public sector banks are able to function commercially while financing the poor as well,” Sinha said.
The participants have been divided into six groups to discuss six main themes: achieving universal financial inclusion; leveraging technology and digitalisation to improve operational efficiency; rethinking priority sector lending; improving risk management, asset quality and recovery; building a robust people strategy for PSBs; and consolidation and restructuring of PSBs for better efficiency, governance and capital efficiency.
Each working group comprises a mix of large and smaller banks. CMDs and EDs from the same banks are participating in different working groups. While chiefs of insurance companies are spread across all the discussion groups, those of financial institutions will participate in the priority sector lending group.
These groups will hold discussions and finalise their reports and present them to Prime Minister Narendra Modi who will attend the valedictory session on Saturday along with Finance Minster Arun Jaitley.
Priority sector rethink Briefing newspersons here on the day’s events, Hasmukh Adhia, Secretary, Department of Financial Services, said: “Since 1972, the 40 per cent target given remains the same and there is surely need for change as per the recommendations of bankers and regulators.”
The other issues that needed to be addressed was how to raise the savings rate from 30 to 35 per cent, using the accounts as channels for direct transfer and leveraging technology to improve banking technology.