The government has decided to merge the two, Bharatiya Mahila Bank and State Bank of India to ensure better and greater banking services to maximum of women.
The finance Ministry said,” the decision has been taken in view of the advantage of the large network of SBI.” Further it was said, “ the objectives of affordable credit to women as well as propagation of women-centric products need to be quickly achieved through a wider network and lower cost of funds.”
“The proportion of administrative and managerial cost in BMB is much higher to reach the same coverage. For the same cost, a much higher volume of loans to women could be given through SBI.
Karthik Srinivasan, Senior Vice President, said, “ this merger will help SBI get paid capital worth INR 1,000 crore lying on the books of BMB.”
Statement from State Bank of India:
“The addition of 103 branches of BMB and business of approximately INR 2,000 crore would not make significant impact on the branch network and business levels of SBI, it will be ensured that the strengthens and reinforces SBI’s focus on financing of women entrepreneurs in order to fulfil the objectives behind setting up Bhartiya Mahila Bank.”
Other things to note:
In the three years since BMS is set up, it has extended loans of INR 192 crore to women borrowers. The SBI group has provided loans of INR 46,000 crore to women. SBI has more that 20,000 branches and a workforce of around 2 lakh where 22% are women.
Also, all the branches of associate banks will be functioning as braches of SBI, says THE RESERVE BANK OF INDIA.