Why in the News?
In October 2022, 75 Digital Banking Units were launched across remote districts to commemorate India’s 75th Independence Day, but their momentum has declined from past 2 years.
About Digital Banking Units (DBUs):
- DBUs are specialized, fixed-location banking hubs designed to deliver a wide range of digital financial services using modern infrastructure.
- They operate in both self-service and assisted modes, offering customers 24/7 access to banking in a paperless, secure, and cost-effective environment.
- The RBI permits commercial banks with digital banking experience to establish DBUs in Tier I to Tier VI cities, without prior approval unless restricted.
- RRBs, payment banks, and local area banks are not eligible.
- In October 2022, as part of India’s 75th independence anniversary, 75 DBUs were launched across 75 remote districts to promote financial inclusion and bring banking services closer to citizens in semi-urban and rural areas.
Services and Features:
- DBUs offer digital services such as account opening, internet and mobile banking kits, debit and credit card applications, and UPI QR-based merchant solutions.
- Customers can apply online for retail loans, MSME loans, and government-sponsored schemes, with the entire process—from application to disbursal—handled digitally.
- Each DBU operates independently from existing branches and must follow RBI guidelines, including housing in separate premises with automated-only cash services.
- They are equipped with interactive teller machines, cash recyclers, document upload systems, and video KYC facilities.
- A senior bank executive is appointed as Chief Operating Officer (COO) to manage each unit.
Benefits Offered:
- DBUs offer a convenient, paperless banking experience, reducing the need to visit traditional branches.
- They support inclusive banking by expanding access to financial services in underserved regions.
- Customers in remote areas benefit from both automated and assisted service options.
- For banks, DBUs help optimize costs while improving service delivery and outreach.
| [UPSC 2024] Consider the following statements in respect of the digital rupee:
1. It is a sovereign currency issued by the Reserve Bank of India (RBI) in alignment with its monetary policy. 2. It appears as a liability on the RBI’s balance sheet. 3. It is insured against inflation by its very design. 4. It is freely convertible against commercial bank money and cash. Which of the statements given above are correct? Options: (a) 1 and 2 only (b) 1 and 3 only (c) 2 and 4 only (d) 1, 2 and 4* |
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