eBkray: Sitharaman launches e-platform for sale of assets attached by PSU banks

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December 29, 2019 6:09 AM

With the Essar resolution decision, banks have recovered Rs 38,896 crore, on top of the Rs 4.53 lakh crore recovered in the past four-and-a-half years.

Apart from top finance ministry officials and bankers, the meeting chaired by Sitharaman was also attended by CBI director RK Shukla and two joint directors of the agency.

Finance minister Nirmala Sitharaman on Saturday launched a common online platform named eBkray to auction assets attached by various state-run banks, seeking to bring in transparency in the sale of 35,000 properties currently available and many more in future.

After a meeting with chiefs of state-run banks on Saturday, ahead of the Budget, the minister also announced that the revenue department will notify RuPay and UPI as the prescribed mode of payment for undertaking digital transactions without any MDR charges from January 1, 2020. Accordingly, all companies with a turnover of Rs 50 crore and above will be required to offer payment facility through RuPay debit card and UPI QR code to their customers, in sync with a Budget proposal.

The e-platform to sell assets provides a single-window access to information on all the properties up for e-auction, as well as a facility for the comparison of similar properties. It is equipped with property search features and navigational links to all the e-auction sites of the state-run banks, and also contains photographs and videos of uploaded properties. “There has been information asymmetry when bank-attached assets are auctioned, which will come to an end with the launch of eBkray,” Sitharaman said.

Public-sector banks (PSBs), finance secretary Rajiv Kumar said, are returning to profitability at a fast pace—13 PSBs clocked profits in H1FY20, against just six a year before.

The shadow-banking space, too, is ‘stabilising’ after the IL&FS default and banks’’exposure to top 50 NBFCs went up by as much as 38% year-on-year as of September 2019 to Rs 4,06,666 crore.

To expedite decision-making and prevent potential harassment of bankers for genuine commercial decisions at a time of increased frauds, it was decided that the Central Bureau of Investigation (CBI) would soon hold meetings with bank officials and address their concerns and doubts. Soon, the finance minister will also hold meetings with officials of the Directorate of Revenue Intelligence, Enforcement Directorate and income tax and customs departments for this purpose.

Apart from top finance ministry officials and bankers, the meeting chaired by Sitharaman was also attended by CBI director RK Shukla and two joint directors of the agency.

CBI would develop a mechanism — similar to the one recently introduced by the taxman — so that all its notices carry a registration number to squeeze any scope for unauthorised communications. As such, the CBI doesn’t take up bank fraud cases on its own, but it does so only when the PSBs approach the agency after getting clearance from its own institutional mechanism.

At the same time, Sitharman directed public-sector banks to fast clear pending vigilance cases, accummulated over the years against their officials for alleged malpractices. Accordingly, PSBs will set up committees under GM-level officials for this purpose.

To bolster the audit process at banks, the Indian Bank Association will put in place a robust system for assessing adherence to standards by forensic auditors, and tie up with the CBI for training forensic auditors, the finance ministry said in a statement.

Commenting on the shadow-banking space, the ministry said good NBFCs, including housing finance companies, are able to raise funds from the market ocassionally even at rates lower than the levels before the IL&FS crisis. It, however, conceded that the market is distinguishing between good and not-so-good NBFCs and financially-sound entities are able to obtain higher financing from both banks and the market.

The ministry said reforms carried out by the government have restored banks to health, with gross bad loans of PSBs having dropped from Rs 8.96 lakh crore in March 2018 to Rs 7.27 lakh crore in September 2019. However, earlier this week, a central bank report said bad loans of banks as a percentage of total loans could increase to 9.9% by September 2020 from 9.3% in September 2019, reversing a drop witnessed this year. Nevertheless, the report suggested that banks’ resilience to the bad loan shocks had improved.

With the Essar resolution decision, banks have recovered Rs 38,896 crore, on top of the Rs 4.53 lakh crore recovered in the past four-and-a-half years.

To further capitalise banks and improve their capacity to lend, additional infusion of Rs 8,855 crore (Rs 4,360 crore to Indian Overseas Bank, Rs 2,153 crore to Allahabad Bank, Rs 2,142 crore to UCO Bank and Rs 200 crore to Andhra Bank) has been approved, in addition to the release of Rs 60,314 crore so far this fiscal, the ministry said.

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