PM Modi will virtually launch digital banking units, or DBUs, in areas such as Leh, Lakshadweep, Aizawl, Kota, Nainital, Jammu, and Lucknow, among others
11 public sector banks, 12 private banks and 1 small finance bank are participating in the project
DBUs are physical outlets which will provide a gamut of digital banking facilities to citizens in both self-service and assisted mode
With an eye on shoring up the country’s digital banking ecosystem, Prime Minister Narendra Modi is all set to launch 75 digital banking units (DBUs) across 75 districts on Sunday (October 16).
DBUs are physical outlets which will provide a gamut of digital banking facilities. They will house a certain minimum digital infrastructure to deliver digital banking products and services in both self-service and assisted mode.
The brick-and-mortar units will enable customers to access services such as opening of savings accounts, transfer of funds, investment in fixed deposits, and making loan applications.
“The DBUs are being set up with an objective to ensure benefits of digital banking reach every nook and corner of the country and will cover all the states and union territories,” the government said in a statement.
As many as 11 public sector banks, 12 private banks, and 1 small finance bank are participating in the project. Earlier, Inc42 reported that South Indian Bank was gearing up to launch its DBU.
PM Modi will virtually launch the DBUs in areas such as Leh, Lakshadweep, Aizawl, Kota, Nainital, Jammu, and Lucknow, among others.
DBUs are envisaged to further deepen financial inclusion in the country and enable users to access banking facilities throughout the year. Besides, DBUs have also been modelled in a way that they can spread awareness about matters such as digital financial literacy and cyber security.
“Also, there shall be adequate digital mechanisms to offer real time assistance and redress customer grievances arising from business and services offered by the DBUs directly or through business facilitators/ correspondents,” the statement said.
The Financial Inclusion Pitch
This builds on the promise made by Finance Minister Nirmala Sitharaman about launching DBUs in her Budget speech earlier this year.
In preparation for the launch, the Reserve Bank of India (RBI) has so far announced new measures to regulate and streamline operations of DBUs. In April, the central bank released the guidelines for establishment of DBUs. The norms also allow DBUs to offer services such as MSME loans to customers, apart from the run-of-the-mill banking facilities.
While the move is expected to offer a cost effective and convenient experience, and enhance digital experience of banking products, it remains to be seen how authorities scale up DBUs to connect more hinterlands with the mainstream financial network.
