Government announces Details Of Bank Recap And Comprehensive Reform Plan

| January 24 , 2018 , 20:20 IST

The Government of India on Wednesday unveiled details of the re-capitalisation of Public Sector Banks (PSBs) announced in October 2017.  The capital infusion plan for 2017-18 includes Rs 80, 000 crores through Recap Bonds and Rs 8,139 crores as budgetary support.  This plan addresses regulatory capital requirement of all PSBs and provides a significant amount towards growth capital for increasing lending to the economy. 

The recap would be accompanied by a strong reforms package across six themes incorporating 30 action points. The reforms agenda is based on the recommendations made at the PSB Manthan held in November 2017 involving senior management of PSBs and representatives from Government. 

Capital infusion by the Government is contingent on performance of PSBs on the reform.  Whole Time Directors of PSBs would be assigned theme wise reforms for implementation.  Their performance in this regard would be evaluated by the Bank Board.

A survey by an independent agency would be conducted to measure public perception about improvements in access and service quality.  Results of the survey shall be made public each year.

The recap & reform agenda is sharply focused on strengthening PSBs, increasing lending to MSMEs and making it easier for MSMEs and retail customers to transact as well as significantly increasing access to banking services.  It includes a commitment to banking services within 5 kilometres of every village, refund within 10 days of any unauthorised debit in electronic transactions, a mobile App for locating banking outlets and a mobile ATM in every underserved district.