PSBs merger to help reach $5 trillion economy target: Finance Secretary

The Centre’s decision to amalgamate ten Public Sector Banks (PSBs) into four mega state-owned lenders will act as a catalyst for achieving $5 trillion economy target, Finance Secretary Rajiv Kumar has said.

“To support the next level of growth, the country needed big banks. The mega-merger announced on Friday aims to achieve that objective. We will now have six megabanks with enhanced capital base, size, scale and efficiency to support high growth that the country requires to break into the club of middle-income nations,” said Kumar, in an exclusive interview with PTI.

The merger will help in creating strong and globally competitive banks with economies of scale and enable accomplishment of wide-ranging synergies, he said. As a result of this merger, banks will now have a broad reach, stronger lending capacity and streamlined products and technology in a bid to serve customers of new India.

Furthermore, the banking sector, would now be technology-driven, clean and responsive and there will be no gaming of the system by any of the stakeholders in the financial sector space be it, auditors, rating agencies, creditors, or bankers, added Kumar.

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