M.G. Bhat, GM, RRBs & Lead Bank Wing, Canara Bank, provides details of the functioning of 2 high profile RRBs
Canara Bank has sponsored 2 RRBs – Kerala Gramin Bank (KGB) and Pragathi Krishna Gramin Bank (PKGB). While KGB is operating in entire Kerala with 572 branches and 246 ATMs, PKGB is operating in 11 eastern districts of Karnataka with 645 branches and 217 ATMs.KGB is the largest RRB in the country with a total business of over Rs 20,000 crore.
M.G. Bhat, GM, RRBs & Lead Bank Wing and chairman, PKGB, says: “For the current fiscal, our RRBs have planned to increase their branch network by 5%. Till September 2015, these two RRBs have opened 7 new branches and installed 51 ATMs. They will be adding another 30 branches and 35 ATMs by end of March 2016.”
The 2 RRBs have a combined customer base of over 147 lakh. They have a well established network of over 1217 branches, 884 BC locations and 157 banking kiosks. Bhat claims these will be reaching out to the last mile customers in their operational area to provide access to basic banking services.
DIFFERENTIATORS
He mentions that these two banks have registered a phenomenal growth of over 15% under all the major business parameters during the last 3 years. They have a CD ratio above 97% with advances to priority sector constituting over 85% of their total advances. They have taken many initiatives for expanding the outreach to women beneficiaries, SHGs and JLGs and succeeded in improving their economic conditions. They have also introduced junior debit cards for the benefit of students. UnderPMJDY, they have opened over 8.87 lakh accounts and issued RuPay cards to all the account holders. Some 9.88 lakh families are brought under the fold of social security schemes – PMJJBY, PMSBY and APY – which is highest among RRBs. They are also the first among the RRBs to implement e-KYC and Aadhaar-enabled Payment System (AEPS).
Bhat claims they have taken several initiatives to make business operations more efficient, robust and scalable while leveraging best of technology solutions like deploying multiple banking channels to make the products and services easily accessible to the needy and at their doorsteps. “They have introduced mobile banking. As of today, they have the largest network of ATMs and RuPay card base among RRBs. Recently, they have also implemented system based loan processing module for loan products like agriculture crop loans, gold loans and retail loans, which is first amongst RRBs.”
DEPOSITS, LOANS
Priority sector lending of these RRBs constitute 89% of their total advances. The major portion of their credit has gone to sectors like agriculture and allied activities (60%), micro and small enterprises (13%), housing, education and consumption loans for low income groups and weaker sections. As at September 2015, the total business of both these RRBs together has crossed Rs42,600 crore mark with 16% yoy growth, says Bhat. Aggregate deposits are at a level of Rs21,600 crore with a CASA ratio of 34% and gross advances are at Rs21,000 crore with a CD ratio of over 97%, he adds/
TECHNOLOGY
Both the RRBs have implemented CBS in September 2011. They have procured common computing infrastructure with their own data centers and DR sites. They are offering several technology-based products and banking services like mobile banking with IMPS facility, ATMs, RuPay debit cards, RuPay Kisan cards, RuPay MUDRA cards, RTGS/NEFT, AEPS, eKYC account opening, ECS, e-Commerce, SMS alerts, etc.
The net NPA of both the RRBs are well below the tolerable limits. In the current financial year, they have enabled their CBS systems to generate reports of special watch accounts and incipient NPA accounts on a daily basis. Reveals Bhat: “All regional offices have been strengthened for monitoring branches with high NPAs and also for conducting recovery camps, recovery adalats and lok adalats at selected locations where the quantum of NPAs are more. They are also creating awareness on credit discipline through financial literacy programmes at all centres.”
TARGETS
The two RRBs are also taking necessary steps for popularizing their technology products by sensitizing the branch staff and creating awareness among customers to improve business and reduce transaction cost. With a view to enhancing customer service and taking into account demand for such services, they are planning for extending the facility of internet banking to their customers in the near future subject to necessary regulatory approval. They will be recruiting staff under various cadres through common recruitment process of RRBs conducted by Institute of Banking Personnel Selection (IBPS) during the year.
Bhat estimates, “Achieving a total business level of Rs45,000 crore with a CASA share of 40% in a campaign mode are prime focus areas of these 2 RRBs for the current fiscal.”
