SBI and WDRA to Come Together for Financing Against e-NWR
Largest public sector lender the State Bank of India (SBI) has signed a Memorandum of Understanding (MoU) with Warehousing Development and Regulatory Authority (WDRA) for easy and quick disbursal of loans. The MoU will promote loans against electronic Negotiable Warehouse Receipts (e-NWR) issued by WDRA-registered warehouses. The MoU were signed by Dinesh Khara, Chairman, SBI, and TK Manoj Kumar, Chairman, WDRA this week.
This MoU will promote warehouse registrations while improving the finance against e-NWRs. Both SBI and WDRA will be working along with each other for providing finance and organizing farmer awareness. The companies will also be working on capacity-building programs for farmers to manage and operate the services offered by e-NWR, effectively. In addition, the MoU will also facilitate joint inspection of the financed warehouses to ensure operations and maintenance standards.
The bank has taken this step to encourage seamless flow of farm credit to individual farmers against pledge/hypothecation of agricultural produce and leveraging the inherent safety of e-NWRs issued by the warehouses registered and regulated by WDRA. To support the agrarian growth, RBI had recently enhanced the loan limit from ₹50 lahks to ₹75 lakhs per borrower against e-NWRs for classifying under the Priority Sector Lending.
On the signing the pact, Dinesh Khara, Chairman of SBI, said, “We are happy and privileged to contribute to India's agri-economy and support the government's initiatives. Our focus is to uplift approximately 60 per cent of the Indian farming population by enabling them through our value added offerings. With this collaboration, we will provide all the necessary aid to the agricultural sector by increasing their financing options."
To increase liquidity in the rural areas, State Bank of India has launched Produce Marketing Loan (PML) for farmers, to be issued against e-NWRs by WDRA registered warehouses. The product will be a short-term demand loan (max. 12 months) for farmers at a competitive rate of interest, with a waiver in processing fees and collateral security. Pledge finance, especially those against e-NWR will help small and marginal farmers to avoid distress sales immediately after harvest when the prices are usually low. Farmers can safely keep their farm produce in warehouses registered with WDRA and can avail of finance from SBI for liquidity.
State Bank of India is the largest commercial bank in terms of assets, deposits, branches, customers, and employees. It is also the largest mortgage lender in the country, which has so far fulfilled the home buying dreams of over 30 lakh Indian families. The home loan portfolio of the bank has crossed Rs. 6.00 lakh crore. As on September 30, 2022, the bank has a deposit base of over Rs. 41.90 lakh crore with CASA ratio (Current Account Saving Account Ratio) of 44.63 per cent and advances of more than Rs. 30 lakh crore. SBI commands a market share of 32.9 per cent and 19.2 per cent in home loans and auto loans respectively. SBI has the largest network of 22,309 branches and 65,796 ATMs / ADWMs in India with 66,757 BC outlets. The number of customers using internet banking and mobile banking stand at 107 million and 54 million respectively. With SBI’s digital strategy right on track – the bank witnessed 63 per cent of new savings accounts opened through the integrated digital and lifestyle platform YONO in FY23. SBI also has the highest number of followers on Facebook and Twitter amongst all banks worldwide.