New Delhi: The Department of Financial Services Secretary M Nagaraju on Monday said state-run lenders need to focus on building capacities, timely capital raises and efficient resource allocation.
Speaking at the industry body IBA's annual general meeting here, Nagaraju said the dozen-odd public sector banks should collaborate for improvements in areas such as cyber security, risk management, AI analytics, fintech incubation, and cloud services.
"Each bank also needs to identify its focus on building capacity and planning roadmaps for appropriate and timely capital raising and efficient allocation of resources besides striving to bring down intermediation costs," he said.
Making it clear that the financial health of lenders has improved due to the reform measures undertaken by the government over the last seven-eight years, Nagaraju said banks should "strive" to reduce intermediation or operations costs to make credit more affordable for the general public.
On collaboration, he said PSBs are well-poised to share best practices among themselves.
The state-run banks stand to benefit individually and also as a collective through such measures, he said.
"There has been somewhat limited development on the collaboration or alliance front with services being offered," he rued.
He also said that the banks are healthier and robust now with good asset quality now.
The DFS secretary asked the IBA to play a proactive role in strengthening the regulatory framework and increasing the trust in the industry.
The grouping should also drive innovation and inclusivity by helping create new impactful products, he said.
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