Sitharaman ask fintechs to find solutions to prevent digital arrests, cyber frauds
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Business Standard
6 days ago
- Business Standard
Finance Ministry urges PSBs to expand branches amid private sector growth
Amid rising competition from private and small finance banks, PSBs have been asked to scale up physical infrastructure and cover over 200 unbanked population clusters New Delhi The Union Finance Ministry has directed public sector banks (PSBs) to identify potential areas and expand their branch networks amid intensifying competition from private banks, according to a senior government official who spoke on condition of anonymity. 'Banks have been asked to compete with the aggressive branch expansion by private sector banks and Small Finance Banks. PSBs need to scout for potential areas and open new branches,' the official said. During FY 2024–25 (till 31 December 2024), PSBs opened 1,391 new branches—271 in metropolitan areas, 311 in urban, 539 in semi-urban, and 270 in rural regions. In comparison, private sector banks led the expansion with 1,552 new branches: 545 in metropolitan, 466 in urban, 318 in semi-urban, and 223 in rural locations. Digital progress noted, but physical expansion emphasised The finance ministry has acknowledged the progress made by PSBs in enhancing digital capabilities. However, officials have made it clear that this must not come at the cost of physical presence. 'A strong physical presence helps build personal connections with customers, enhances service delivery, and plays a crucial role in mobilising deposits,' the official said. Earlier this month, Union Finance Minister Nirmala Sitharaman said India's financial future would be 'phygital'—a blend of physical and digital services. 'It is important to leverage the reach of technology as well as maintain physical presence to serve customers better and build trust over time,' Sitharaman said at the Digital Payments Awards 2025 in New Delhi. Private banks dominate branch expansion in FY25 Major private banks continued their aggressive branch rollout in FY 2024–25. HDFC Bank led with 421 new branches—137 in metropolitan areas, 168 in urban, 98 in semi-urban, and 18 in rural. ICICI Bank followed with 249 branches (83 metropolitan, 91 urban, 36 semi-urban, and 39 rural). Axis Bank added 337 branches, including a notable 107 in rural areas. Kotak Mahindra Bank opened 72 branches, primarily in urban and semi-urban zones, while Mahindra Bank added 13. Other private banks contributed 460 branches. Focus on financial inclusion in North Eastern region The finance ministry has also asked PSBs to expand banking infrastructure in the North Eastern region, where population density is lower but financial inclusion remains a priority. 'Two hundred and fifteen clusters with populations exceeding 3,000 and no bank branches have been identified,' the official said. In Phase 1, branches will be opened in 51 clusters with populations above 8,000. These locations have already been allotted to banks. In Phase 2, the remaining 164 clusters will be covered. Strong performance by PSBs in business, profitability Between FY 2022–23 and FY 2024–25, total business of PSBs rose from Rs 203 lakh crore to Rs 251 lakh crore. During the same period, net non-performing assets (NPAs) declined from 1.24 per cent to 0.52 per cent. Net profit increased from Rs 1.04 lakh crore to Rs 1.78 lakh crore, while dividend payouts grew from Rs 20,964 crore to Rs 34,990 crore.
The Print
19-06-2025
- The Print
Sitharaman ask fintechs to find solutions to prevent digital arrests, cyber frauds
She said it is important to ensure that startup companies come up with solutions so that people are not arrested at home digitally, or fly-by-night operators do not take their money. Speaking at the Digital Payments Awards 2025 ceremony here, the minister credited fintechs with helping speed up financial inclusion and taking the payment system to even the far-flung areas of the country. New Delhi, Jun 18 (PTI) Finance Minister Nirmala Sitharaman on Wednesday asked fintech startups to come out with solutions to deal with the rising incidence of digital arrests, cheating by fly-by-night operators, and other kinds of cyber frauds. Another major threat, Sitharaman pointed out, is deepfake technology, which is causing a lot of damage to the public in large. 'Today, we should take care in addressing them so we need a set of fintech companies which are constantly working to give solutions for the newer challenges which are arising,' she said. She also called upon the fintech sector to further expand the digital lending facilities to the key MSME sector. Indian fintech innovations have the potential to become global public goods that can benefit other emerging and developed economies. This will open new markets for Indian firms, she added. International merchant payments through UPI are now accepted at select merchant outlets in seven countries — Bhutan, France, Mauritius, Nepal, Singapore, Sri Lanka and the UAE. 'Our players must aim to export our successful models abroad and capture global markets. We have the talent, we have the market scale and we have the proven solutions,' she said. This, she said, will open up new markets for domestic firms. The Indian fintech market is projected to grow to over USD 400 billion by 2028-29. 'That's not too far away. Just three years. Reflecting on an anticipated annual growth of 30 per cent, the scale of opportunity is immense. I firmly believe its best chapters are yet to be written. 'Together, let us innovate, include, and inspire. Innovate new solutions fearlessly, include every citizen in your vision, and inspire the world with what India can achieve,' she said. Noting that India now actually accounts for almost half of all real-time digital transactions in the world, she said, direct benefit transfer (DBT) has saved a lot of money by plugging leakages. About Rs 44 lakh crore have been transferred through DBT since 2014 and Rs 3.48 lakh crore have been saved. The minister said the speed at which innovation is happening in India is just a dream for many other countries. 'Several advanced countries are nowhere close to the kind of momentum our fintech companies have achieved, not just in terms of progress in their respective areas but also in creating entirely new paradigms. 'This is something which is very unique of the Indian fintech sector,' she added. A World Bank study found that India achieved a financial inclusion rate of 80 per cent in just six years through Digital Public Infrastructure (DPI), Sitharaman said. Some observers who have gone through this report have said that this feat would have otherwise taken nearly 50 years, she said. On customer service, she said the future of finance will be 'Phygital' — physical and digital — so it is important to leverage the reach of technology as well as have physical presence, to serve customers better and build trust over time. Speaking on the occasion, Minister of State for Finance Pankaj Chaudhary highlighted the foundational role of the banking sector and fintechs in powering India's digital financial transformation. He underlined that banks have built infrastructure and trust while fintechs have driven innovation and user-centric design together, making digital payments an everyday reality. Financial Services Secretary M Nagaraju said in his address that India's digital payments sector has grown exponentially in the past few years. In FY 2024-25, UPI achieved a landmark 18,587 crore transactions amounting to 261 lakh crore. This growth is a result of innovation and user-centric approach. PTI DP NKD DIV DIV This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
India.com
19-06-2025
- India.com
FM Sitharaman Urges Fintechs To Look Beyond Cities, Tap Into Rural Indias Potential
New Delhi: Finance Minister Nirmala Sitharaman on Wednesday urged fintech companies to focus more on rural India, saying it is not just a developmental need but also a big business opportunity. In her address at the Digital Payments Awards 2025 here, the minister said that the next wave of fintech innovation should come from villages and the agricultural sector. She encouraged companies to see rural areas as potential markets rather than just a part of their corporate social responsibility. "Rural India is a fertile ground for growth. Every fintech firm should explore it, as demand is growing and sustainable," FM Sitharaman said. She pointed out that just like FMCG companies have grown by entering rural areas, fintech companies should also adopt a similar strategy to expand. FM Sitharaman also highlighted the need to bring more micro, small, and medium enterprises (MSMEs) into the digital financial ecosystem by connecting them to account aggregator frameworks. The minister also stressed the importance of creating financial products that are designed for farmers and rural consumers. "These users have different needs and challenges, which require customised solutions," she added. However, the minister also warned about rising risks in the digital space. She said that digital frauds and deepfakes are serious threats and called for greater investment in digital literacy and cybersecurity. "Cybersecurity is a growing concern. I have spoken to many startups and fintech firms about this. We need solutions that protect people from digital fraud and misuse,' FM Sitharaman stated, adding that no user should feel 'digitally arrested at home' due to unsafe platforms. At the same event, Financial Services Secretary M. Nagaraju stressed the next phase of India's digital payments journey. He said it is important to push for digital adoption in underserved regions and sectors. Nagaraju also stressed the need to build strong systems to prevent fraud and improve digital and financial literacy, especially at the grassroots level.
