The three-year old fledgling Bharatiya Mahila Bank (BMB) will be merged with the State Bank of India to expedite the outreach of banking services to women, the finance ministry said on Monday.
“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,” an official statement said, justifying the merger’s advantages owing to SBI’s large network.
“In the three years since BMB was established, it has extended loans of 192 crores to women borrowers, while the State Bank of India (SBI) group has provided loans of about 46,000 crore to women borrowers,” the ministry said.
With over 20,000 branches and the lowest cost of funds among banks, SBI has a total workforce of around 2 lakh employees of which 22% are women.
“The SBI group already has 126 exclusive all-women branches across the country while BMB has only seven. 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,” the statement noted.