New Delhi: State-owned banks have joined hands to form a new company that will take banking services to the doorsteps of their customers as the second wave of Covid-19 pandemic has severely affected operations.
According to a report in the Economic Times, the new company is called PSB Alliance Pvt Ltd and it will engage banking correspondents on behalf of the 12 public sector banks under a common standard operating procedure (SoP) to provide financial and non-financial services at customers’ homes.
Former State Bank of India (SBI) chief general manager and deputy CEO of Reliance Jio Payments Bank, Rajinder Mirakhur has been appointed as CEO of the new company.
“Currently, different PSBs engage different banking correspondents (BCs) for their doorstep banking services. With this company we are hoping to provide resources which can be used by all PSBs at a low cost,” the business daily quoted Mirakhur as saying.
At present, 11 non-financial services like cheque pick-up, requests for account statements, tax documents like TDS certificates and digital life certificate, delivery of pay orders etc can be done through this facility. Cash withdrawal is the only financial service currently provided. PSB customers can request these services through web, mobile app or phone after an OTP-based verification process.
Customers availing this service will have to pay a fee of about Rs 88 per service including GST. A part of this fee will go to the vendor providing the service and the rest to the bank. Currently, two vendors, Atyati Technologies and Integra Microsystem have been hired for delivery of the services.
“We are still finalising the model to scale up. We can either hire different BCs and use their technology and manpower or create our own application to be used pan India by all BCs servicing PSBs which will create standardisation and ensure all can plug into the system, which is more feasible,” Mirakhur told the publication.
PSB Alliance has a capital base of Rs 14 crore and has emerged out of another PSB-promoted company Cordex India, formed in 2010, to study operational risk in banks. The articles of association of Cordex were changed on April 29 to include doorstep banking services after it received approval from the companies registrar as PSB Alliance, the business daily mentioned.
Two private-sector lenders IDBI Bank and ICICI Bank were also investors in Cordex but will surrender their stakes in favour of PSBs.
Bankers said the model has various benefits. “It gives us economies of scale, collective bargaining and pooling of resources. Most of all, it gives us a collective knowledge pool which will help us to benefit from each other’s experiences,” the business daily quoted Rajkiran Rai, MD at Union Bank of India as saying.
Mirakhur said each public sector bank has deputed one person as an employee of PSB Alliance.