State-run banks told to collaborate with startups and fintech to allow credit push

State-run banks told to collaborate with startups and  fintech to allow credit push
The government has asked state-run banks to explore collaboration with startups and fintechs to give a creditpush to the economy and come out with innovative products to bring more people in the formal credit cycle. 
"Lenders can co-create products and further expand reach like giving customised loan offers to those availing direct benefit transfer," said an official aware of the developments, adding that banks can also partner with Account Aggregators (AA) as Financial Information User (FIU) and Financial Information Provider (FIP) in line with their board-approved roadmap. 
"Some of these issues were discussed in the PSB Manthan and accordingly working groups have been set up to look at the possible options," the above quoted official said. 
In PSB Manthan 2022, held last week, banks were asked to set up a three-year roadmap to improve their performance and competitiveness. Banks will focus on both geography-specific opportunities such as economic corridors and business sector-specific opportunities such as green energy. 
 "PSBs need to identify focus areas relevant to them and develop a three-year strategy roadmap," said a bank executive, adding that six groups have been formed to look and suggest measures for key focus areas, including customer service, digitisation, HR incentives, governance and collaboration. 
"Some of these performance indicators will also be a part of the EASE 5.0, the objective is that PSBs can build peer-to-peer collaboration by building and sharing technology, operations, and people capabilities," the above quoted executive added. Enhanced Access and Service Excellence or EASE is a common reform agenda for all PSBs, which aims at institutionalising clean and smart banking. 
PSBs will also explore more collaboration by building and scaling up common utilities and initiatives such as e-auction platforms, cloud platforms, initiatives under PSB Alliance. The government had also suggested that large banks should share their best practices with small lenders and guide them in areas where they need more expertise. 
Lenders will share best practices to expedite detection and mitigation of frauds using data analytics. 
Banks are expected to leverage co-lending partnerships for agriculture and offer digitalised banking solutions integrated across agriculture and allied activities value chain.