SBI says number of zero balance Jan Dhan a/cs below 46%

Mumbai: Top lender State Bank of India has said it has seen a steady decline in the number of zero balance accounts opened under the financial inclusion drive and their count is now below 46 percent.

"The number of zero balance accounts at our branches is rapidly coming down and it is below 46 percent now. In some of the branches, it is in the teens," SBI Chairperson Arundhati Bhattacharya said at a Cibil event Friday.

She said there is still a large number of people who are out of the formal banking system but are looking for access to banking services.

"Even after Prime Minister's Jan Dhan Yojana (PMJDY) scheme came to an end formally, we have been opening 60,000-70,000 accounts everyday which means that people are not content with one account per family and that the family members are coming forward to have their own accounts," Bhattacharya said.

The nation's largest bank has now introduced a nominal charge of Rs 20 to open such accounts, which she said, the government is not very happy with.

"We told the Government that it is important for these people to understand that they are getting something free but there is a value for it. In fact, we found that all of these people who opened these accounts with Rs 20, are actually beginning to maintain more than Rs 500 balances in their accounts," Bhattacharya said.

She said with emergence of credit bureaus, it has relatively become easier for banks to evaluate and approve loans at a faster pace but one should not be too much dependent on the credit information provided by these companies.

"We must remember that there is always what is called a model risk, and, therefore, I urge my people that as we use such scoring models and such engines more and more, they should not leave their brains at home.

"It is important to have a human element somewhere to ensure that we are not going wrong in the models that we set up," she said.

Bhattacharya further said banks are the single largest consumer and supplier of data and it is incumbent on banks to arrange data that is clean and acceptable.

With large institutions like SBI there are several legacy issues and historically many feeds like date of birth is not captured in the system and therefore there is a need for an ongoing data cleansing exercise, she said.

"In our bank, the data cleansing operation is named Project Ganga but like the Ganga we are still very far from getting pure data," she admitted.