Entry of new players, strict regulations challenging established banks: Nirmala Sitharaman

Strict regulatory compliances and entry of new banks and non-bank entities have presented both challenges and opportunities to established players and they should evolve to rise up to the occasion, Union Finance and Corporate Affairs Minister Nirmala Sitaraman said on Saturday.

She was attending platinum jubilee celebration of State Bank of India (SBI), the largest commercial bank in the country. During the event, she virtually inaugurated 70 branches of the bank across India and 17 corporate social responsibility (CSR) initiatives at the SBI headquarters here. Ms. Sitaraman also unveiled 501 women customer service points of the bank on Saturday, which was also the International Women’s Day.

“The SBI views transformation as an ongoing process. The bank has digitised the customer journey end-to-end, enabling continuous engagement through sophisticated, advanced tools,” she said.

“By developing core digital capabilities, the SBI has launched seamless, innovative products while simplifying and redesigning its offerings. To enhance operational efficiency, the bank has transformed its culture and operating models,” she emphasised.

Stating that the SBI was reinventing its personal distribution channels to align with evolving customer expectations, she said, “As the largest commercial bank in the world and in the world’s most populous nation, catering approximately to about 5.6% of the global population, the SBI has become more agile and competitive than ever before.”

“Unlike many organisations that resist change, the SBI has embraced it wholeheartedly, maintaining its leadership across all areas of banking. These transformative initiatives have strengthened the bank’s competitiveness and relevance to its customer base, which is actually very diverse,” she pointed out.

The bank is now ideally positioned to deliver superior value creation through sustainable growth, the Finance Minister said. “The SBI aims to achieve this by enhancing its operational excellence across lending performance, asset quality, profitability and capital generation, thereby driving wealth creation,” she added.

To power these efforts, the SBI has bolstered its infrastructure, established a robust monitoring and control framework, and built a talent pool of committed professionals, she said. Additionally, the bank has re-engineered its internal processes to improve risk management and accelerate growth velocity, she stated.

From its humble beginning, as the Bank of Calcutta in 1806 to the Imperial Bank of India in 1921 and finally to the State Bank of India in 1955, the SBI has grown into a robust organisation. “With an unmatched 218 years legacy, the SBI is an important pillar of India’s financial ecosystem, symbolising resilience, trust and relentless digital first approach,” the Finance Minister added.

“Despite recent disruptions and regulatory tightening, the bank has retained its position as a market leader, earning the trust of crores in the lower income, middle, lower to middle income segments of the economy,” she said. As the number of banking service providers rise and with a surge in tech-savvy customers, there was an increasing demand for innovative, personalised and on-the-go banking experiences, she emphasised.

“The SBI is dedicated to contributing to society, to the larger society and as a trusted partner to over 51 crore customers, bigger than the population of many countries I would say, in fact sometimes continents,” she concluded.