PSBs need govt support for viability of social schemes, says SBI chief

PSBs need govt support for viability of social schemes, says SBI chief

MUMBAI, AUG 28: PTI

SBI chief Arundhathi Bhattacharya today said the government needs to thinkabout “ways and means” to sustain social security schemes like PradhanMantri Jan Dhan Yojana in the long run and compensate public sector banks(PSBs) to make such initiatives commercially viable.

“The government wants that it (PMJDY) should be a sustainable kind ofinitiative... that we should not do it and then allow it to die because it is notcommercially viable. So obviously, the government will have to think of ways and means to ensure that these accounts, once they come in, become commercially viable accounts,” she told reporters.

“We are already working on it with the government. I don’t think the government intends not to give anything. But we are working on what it should be,” she added.

The remarks from SBI chief came a day after Reserve Bank Governor Raghuram Rajan stressed on the need to compensate PSBs to maintain a level playing field as many of the private sector banks do not get pinched by such measures.

“We should recognise that PSBs undertake public interest activities (like the roll—out of accounts under PMJDY) that are not always fully compensated.

Government should endeavour to keep the competitive playing field level by fully compensating banks for activities it wants to undertake in the public interest,” Rajan wrote in the Overview section of RBI’s annual report.

Source :http://aibea.in/upload/flashnews/20150901.pdf