“Phone banking” to “digital banking”

On October 16, 2022, Prime Minister, Narendra Modi, stated that the government’s efforts to switch from pre-2014 “phone banking” to “digital banking” have helped in India’s continued economic growth. He said that during “phone banking,” banks were instructed over the phone as to who they had to lend money to, and under what circumstances.

After dedicating 75 Digital Banking Units (DBUs) to the nation, he said that a nation’s ability to grow economically is directly related to the strength of its banking sector. The banking industry has emerged as a platform for good governance and has improved its service delivery. The minister added that the Direct Benefit Transfer (DBT) has contributed to fix leakages and ushered in transparency. He claimed that the Digital Banking Units (DBUs) will improve citizens’ banking experiences and promote financial inclusion.

Nirmala Sitharaman, the Union Finance Minister, had announced the establishment of 75 DBUs in as many districts across the nation as part of the union budget for 2022–2023 to mark India’s 75th anniversary of independence. The DBUs are being established to make sure that the advantages of digital banking can reach each and every corner of the entire nation. Eleven public banks, twelve commercial banks, and one small finance bank are taking part in the project.