The role of banking in any modern economy is undeniably crucial, as they play a pivotal role in business and the economy at large.

However, the increasing prominence of NBFCs and other means for companies to raise money, including IPOs and listings on the equity markets, has come into focus.

SBI Uses New Loan Disbursement Methodology

The recent flurry of small and medium sector companies onto the equity market made some wonder whether banks were doing enough.

While speaking with Moneycontrol, the CS Shetty, the chief of the largest bank in the country, SBI said that the bank has disbursed Rs 34,000 crore worth of loans to SMEs in the span of the past 9 months.

In addition, CS Shetty also added that the State Bank of India was deploying a new system and new methodology to assess loan demands. Using this methodology, the bank disbursed the said amount to smaller businesses that are generally considered the backbone of the economy.

Shetty advocated and underscored for the importance of data and the availability of the same.

This availability of data according to Shetty has allowed in advancement in loans disbursed to SMEs.

Focus On SMEs

Despite the intense competition in this market, banks like the publicly owned State Bank of India have an edge since they can access and analyse data that helps speed up the underwriting of these loans.

This also comes at a time, when the government in its recent Budget focused on MSME and SMEs and their importance.

The FM devised new plans for availing credit to SMEs, in a much more seamless manner, without many hurdles. In the budget, the FM announced a special scheme for enterprises headed by SC/ST women, in addition to the measures.

SBI Shares

On Tuesday, February 26, the SBI shares were trading in red with minor cuts.

The Mumbai-based banking behemoth's shares dipped by 0.15 per cent or Rs 1.10, taking the overall value of SBI shares to Rs 715.30 per share.