Mumbai: Every bank has to deal with defaulters.
But State Bank of India (SBI) has hit upon a novel way to ensure timely repayments, especially from retail borrowers.
The country’s largest lender has been greeting those likely to default on monthly instalments with a pack of chocolates, reported PTI.
The bank has found that a borrower who is planning to default don’t answer a reminder call from its officials. Hence, SBI thinks the best way to deal with such customers is to visit them at their homes unannounced, with chocolates.
The move, aimed at ensuring better collections, comes amidst rising level of retail lending in the system along with increasing delinquency levels on the back of upward movement in interest rates.
SBI’s retail loan book grew over 16.46% to Rs 12,04,279 crore in the April-June 2023 quarter compared to Rs 10,34,111 crore in the same period last year.
“With two fintechs which use artificial intelligence, we are piloting a novel way of reminding our retail borrowers of their repayment obligations. While one is doing conciliation with borrowers, the other is alerting us on the propensity of a borrower to default. And to such borrowers who are likely to default, the representatives from this fintech will visit them, carrying a pack of chocolates for each of them, and remind them of the forthcoming EMIs,” said Ashwini Kumar Tewari, managing director in-charge of risk, compliance and stressed assets at SBI.
