Technology can play crucial role in strengthening RRBs, says NABARD

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Reviewing the prevalent scenario and the growth prospects ahead, NABARD has put forth a slew of measures to strengthen the operational functions. A special emphasis was levied by NABARD upon the migration to the Core Banking Solutions (CBS) by enhancing the technological potentials of the RBBs. “Technology can play a phenomenal role in contributing towards the growth of RRBS, eliminating the frauds in operations, reducing cost involved in transactions, timely availability of account data etc,” outlined Dr Harsh Kumar Bhanwala.

The performance review was outlined after the meeting on RRB Key Performance Indicators and thrust areas, which was inaugurated by Rajiv Takru, IAS, Secretary DFS, Ministry of Finance. Throwing light upon the opinions mentioned by Takru during the review meet, Dr Bhanwala said that the Secretary DFS has suggested RRBs to completely move on to the technology platform and provide all services like the public sector commercial banks.

Dr Bhanwala also listed out several areas wherein RRBs need to endeavour like long term loans to allied activities, financial inclusion through Rupay-Kisan Credit Cards, promotion of Self-Help Groups and Joint Liability Groups and adopt better corporate governance practices. “The main challenge however before the RRBs is to redesign products, systems and procedures in such a way that they can meet all the financial needs of existing customers and cover the unbanked population,” he added.

Apart from the need for enhancing CBS platforms in RRBs, as a supervisory authority NABARD has also suggested other measures like the need-based recapitalization and consolidation of RRBs. The loans issued by RRBs has crossed Rs1 lakh crore mark for the first time during 2012-13, aggregating to Rs102,382.24 crore as against Rs82,538.29 crore in the previous year, highlighted Dr Bhanwala. In addition, the RRBs have also marked improved performance in profitability, with 63 of the total 64 RRBs earning profits of Rs2,275 crore during 2012-13 period. However, the NABARD Chairman has cautioned RRBs to maintain vigilant stand with regard to the Non-Performing Assets (NPA).

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