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Government of India announces recapitalisation of Public Sector Banks

New Delhi: Government of India (GoI) announced recapitalisation of Public Sector Banks (PSBs) to the tune of Rs. 2.11 lakh crore in October 2017, through the infusion of capital by the Government and the raising of capital by banks from the markets. Rs. 88,139 crore was infused by the Government in PSBs during the financial year (FY) 2017-18 after the recapitalisation announcement and provision of Rs. 65,000 crore has been made in the budget for the current financial year for infusion. Since the recapitalisation announcement till November 2018, PSBs have been recapitalised to the tune of Rs. 1,28,861 crore through infusion and mobilisation of capital from the market. Bank-wise details of capital infusion by the Government in FY 2017-18 and current FY 2018-19, up to 30.11.2018), are in the Annexure.

The benefits that have accrued to customers include, inter alia, the following:

  1. increasing access to banking services from home and mobile through digital banking and enhanced customer ease


    1. unprecedented financial inclusion ,Jan Dhan programme by the Government has enabled opening of bank accounts for millions of previously unbanked customer (about 33.46 crore such accounts have been set up as of 5.12.2018, with a balance of about Rs. 84,800 crores) and allowing users to receive government subsidies (as DBT) and to access remittances, credit, insurance, and essentially being included financially, increased availability of loans up to Rs. 10 lakh to the non-corporate, non-farm small/micro enterprises under Pradhan Mantri MUDRA Yojana (PMMY), wherein a borrower can approach any of the lending institutions or can apply online through portal. (during FY 2017-18, 4.81 crore loans were sanctioned and in the current financial year, as on 7.12.2018, 2.81 crore loans MUDRA loans have been sanctioned.
    2. increasing lending to MSMEs through time-bound automated processing and transparent status-tracking, with financially and technologically strengthened banks leveraging digitalised bank statements and income-tax and GST returns and according in-principle loan sanction within59 minutes, and
    3. meet the production credit requirements of the farmers in a timely and hassle-free manner by introducing Rupay Kisan Credit Card

India’s global-rank for “getting credit” as per World Bank’s Ease of Doing Business Index has improved from 44 in 2016 to 22 in 2018.

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