Mumbai: Bharatiya Mahila Bank, India’s newest public sector bank, will focus on lending predominantly to women, but there will be no restriction on account opening by men.

Usha Ananthasubramanian, the first chairman and managing director of the bank, said in an interview that the bank plans to lend to women or to businesses which are either managed by or make products for women. Seven branches of the bank will go live after Prime Minister Manmohan Singh inaugurates the first branch in Mumbai on Tuesday. Edited excepts:

What is unique about this bank?

This is the first public sector bank which has been created. All other public sector banks have been founded by an individual and then nationalized. There has been no bank created in the public sector space, they have all been acquired by an Act of Parliament. This is a unique bank which has been scripted in the public sector space and it comes with a 1,000 crore capital. A core management team of seven members has been formed by the government of India, headed by me, to set up the bank advised by SBI Capital Markets. The application was made in June and we got the final licence by 25 September. The 1,000 crore capital has already flown in and the systems are in place.

We are setting up nine branches, but Delhi and Indore will not go live tomorrow (Tuesday) because of elections. Mumbai is the first branch, but the bank is headquartered in Delhi. Guwahati, Kolkata, Chennai, Bangalore, Ahmedabad and Lucknow are other branches.

What is the plan in terms of branch expansion?

We aim to have 25 branches in the first year by March 2014 and 75 branches each year after that. Then, there is a seven-year plan for the ramp-up. We needed people of experience because banking is a very serious business. We have taken people from all public sector banks. We have also recruited 30 people on board out of the 100 total people on board currently.

How will your bank be different from other public sector banks?

We must appreciate the fact that women are underutilized as an economic asset and so there is a lot of untapped potential. We need to engage women economically. This bank’s approach will be to inspire people with entrepreneurial skills. We will tie up with NGOs. We will also locally mobilize women to train them in vocations like toy-making or driving tractors or mobile repairs. We will try to reach deeper rural pockets.

Will you lend to and receive deposits only from women?

No. I want to make it clear that it is predominantly for women. For resources, all are welcome. Loans also will be given predominantly to women, but we never say it is not to others and we are targeting 60 out of every 100 to be lent to women. Also, as customers, we will not consider only women as an individual, but we can have a company with a woman CEO as a borrower.

Similarly, a company where 40% employees are women or 20% directors are women could be considered by us. We can tie up with a nursing college for women or a teachers training college for women. Besides, we will also lend to firms that are making certain products exclusively for women.

That’s about loans. What about deposits?

Deposits will flow from everyone, but lending will be predominantly for women. Men building women-centric projects will also be preferred. For instance, garment factories’ employees are predominantly women.

Will you have only women employees?

Right now that is not possible, but we want predominantly women employees.

Will you give subsidized credit to women?

There could be some concessions that are being thought of. We need to encourage women... People are not worried about interest rates, but about timely credit. The borrowers are ready to pay half a per cent more as long as you are able to meet the timeline.

The moneylender is still part of the ecosystem because he can give you money even at midnight. We are looking to give 4.5% on savings accounts up to 1 lakh and 5% for above 1 lakh to encourage more savings and tap CASA (current and savings account deposits). No subsidies are being discussed, but it will all depend on the volumes.

In a country where half of the population is still unbanked, how good is an idea to focus on one section of the society?

We are not excluding anyone for deposits. Even for advances, men are not excluded. In the Indian context, we have a problem where women do not have collaterals, the properties are not in their name, and so we need to focus on taking women on the credit guarantee platform which asks for no collateral for less than 1 crore. Anyone who starts a small enterprise, doesn’t need 10 or 20 crore. We are focusing on empowerment with small amounts which helps them to grow gradually.

Will the bank’s chief always be a women?

It should be because women are coming up in the banking sector, they are all over in various positions. The current general managers could be in pipeline for a CMD (chairman and managing director) in the future.

Have you constituted the board?

Yes. It has just happened. We have six directors as of today. We have Chhavi Rajawat, a sarpanch from Rajasthan; ex-CMD of Dena BankNupur Mitra; Renuka Ramnath; ex-Canara Bank CMD M.B.N. Rao; Tanya Dubash from the Godrej Group; and Kalpana Saroj, CEO of Kamani Tubes. There will be a government nominee on the board.

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