Public Sector Banks To Introduce Auto, Home Loans Under 59 Minutes Loan Scheme

To expand their retail loan businesses, public sector banks (PSBs) are gearing up to introduce retail products, including housing and auto loans, on 'psbloansin59minutes' portal.

The portal was originally introduced to provide in-principle approval for loans of up to Rs 1 crore to micro, small and medium enterprises (MSMEs) in just 59 minutes or less than an hour. However, some of the banks including State Bank of India, Union Bank of India, and Corporation Bank decided to extend in-principle approval to loans of up to Rs 5 crore through the portal.

Bank of India is also planning to onboard some of the retail products on the portal for easier access to loan products, a PTI report said.

Indian Overseas Bank (IOB), which has been actively participating on the portal for the sanction of MSME loans is also going to explore the portal for retail products.

"As the scheme has drawn healthy response from the borrowers, bank is in the process of extending in-principle sanction for loans up to Rs 5 crores under MSME. In due course of time, bank will also offer retail products (housing loan & personal loan) under this platform," it said in a statement last week.

If other products are introduced on the platform, it will help expand the retail businesses of these banks and also bring down the transaction cost.

The platform has helped reduce turnaround time for loan processes in such a way that MSMEs get an eligibility letter and in-principle approval in 59 minutes and can choose the bank of their choice. After the approval letter is received, the loan is expected to be disbursed in 7-8 working days.