Digital bank units will open in 75 districts by July, IBA estimates

Digital banks will open in 75 districts by July

Finance Minister Nirmala Sitharaman, while presenting the budget for the financial year 2022-23, said that 75 DBUs will be set up in 75 districts of the country on completion of 75 years of India’s independence.

On the occasion of completion of 75 years of the country’s independence, digital bank units are likely to start in 75 districts of the country by July. In this budget itself, 75 digital banks were announced to be opened. digital bank units ,digital banking unitTo ease the operations of the Reserve Bank of India (RBI) had issued guidelines in full detail only last month. Indian Banks Association (IBA) said in a statement that as per these guidelines of the Reserve Bank, DBUs of banks will be treated as bank centers and the provisions relating to commencement and winding up of business of each entity need to be kept separate. According to the IBA, banks will also have the option of engaging Digital Business Correspondents as per relevant norms for digital expansion of DBUs.

was announced in the budget

IBA said that all public sector banks, 10 private sector banks and one small finance bank have already started the work of commissioning these units by July 2022. Finance Minister Nirmala Sitharaman, while presenting the budget for the financial year 2022-23, had said that 75 DBUs would be set up in 75 districts of the country on the completion of 75 years of India’s independence. Its purpose is to take the benefits of digital banking to every nook and corner of the country. A committee was constituted under the chairmanship of Ajay Kumar Choudhary, Executive Director, Department of Financial Technology, RBI to prepare the blueprint for the formation of DBU. The committee also included senior officials from RBI, select banks and IBA. A working group was formed under the chairmanship of IBA Chief Executive Sunil Mehta to assist the committee. This working group recommended the names of 75 districts representing all the states and union territories across the country.

RBI eyeing pilot test

RBI is continuously monitoring the pilot testing of this project. Emphasis has been laid on digital usage, cyber security awareness and customer education on security measures. As per RBI guidelines, each DBU will have to offer certain minimum digital bank products and services in terms of loans and deposits.