The life journey of Ujjivan Bank.

On 7th October 2015, a non-banking finance company (NBFC) decided to turn itself into a finance bank and followed the regulations by RBI; has turned out to be the one of the best small finance bank and 6th best place to work for. The bank truly works on the principle of cooperate social responsibility (CSR) and has been working hard to serve neglected and undeserved sections of the society. They have been actively working for the economically poor who have been denied financial help from other financial institutions. 

This bank is the best example of following all responsibilities, facilities, and techniques which should be ideally followed by a bank as discussed above.

RESPONSIBILITIES

Meeting the RBI requirements

Ujjivan bank was originally a financial company which started its operations in 2005 and later it was turned into a financial bank in 2015.

• The first requirement was met by the bank, of having a 10years of experience in the financial stream in 2015.
• The second requirements which talk about not having a promoter which is central/state-owned or public authority; was fulfilled as its promoter was a private company ( Ujjivan financial services).
• The third criterion was of having a good credit rating, as the company had zero debt, there was no credit rating which could be given to the company.
• As the company had no previous records of having debts, its record was clean and impeccable.
• Ujjivan financial services had capital which successfully crossed the requirements of RBI i.e., a total of Rs500cr.
• The promoters (Ujjivan financial services) will bring down the stakes by the year 2022, which fulfills the sixth and final requirement of RBI.

As all the rules and regulations were successfully followed by the company it was turned into a financial bank in 2015 and it started its banking operations under the BANKING REGULATIONS ACT, 1949.

FACILITIES

The banking facilities offered by Ujjivan bank

The bank has been offering a plethora of services to its customers from every stratum and is trying to cater them with financial solutions for their everyday needs. Few of the many services provided by them are:

• Accounts- Options of saving accounts, current accounts, joint accounts, corporate salary accounts, minor account are offered to its customers. The banks also offer unlimited free ATM transactions, no additional charges for non-home branch, net banking, customer care services, and many more customer-friendly facilities are offered.
• Loans- These are the most important service provided by any bank. Ujjivan bank provides home loans and the MSME business loans at reasonable interest rates to help new businesses to grow without finance being an obstacle.
• Deposits and micro banking- Deposits like fixed, recurring, tax saver fixed deposits helps the customer earn higher interest with flexibility in the lock-in periods. The minimum deposit can be as less as Rs1000 and the interest periods are also very convenient for the customers. The option of micro banking helps the middle class and economically poor society to easily borrow a small amount of money at less interest and other fees

TECHNIQUES

Use of advanced technology in banking activities

Ujjivan bank has welcomed and incorporated technology and innovations of IT. The bank has been able to deliver financial services to its customers for years now. There are various ways by which Ujjivan bank has used technology such as:

• Virtualized server recovery (VSR) – This cloud-based solution helps the bank to manage and support the application; reduce business expenses and risk of loss of data. It helps the business in facilitating the smooth performance of the transaction in online mode.
• Use of Biometric- Ujjivan bank has biometric-enabled ATMs through which customers can access their accounts at the ease of their fingerprint. This also includes the withdrawal of money and other range of services.

The small finance bank has also come up with multiple services which have eased the process and activities of banking for its customers like mobile and net banking, use of EVM chip and magnetic tracks on the debit cards which make the transactions easy, convenient and seamless.

Position of Ujjivan bank

Ujjivan back started its banking activities just 5 years, but it has been growing by leaps and bounds. The bank has an annual net profit of Rs.198.4cr, which was a massive growth as compared Rs.7.3cr of the last fiscal year. The bank has reported 46% growth was due to raise in the loan assets which were of Rs11,049cr with strong asset quality.
The bank’s retail deposit also grew to Rs2,736cr from Rs428cr, which was an approx. growth of 37% compared to the previous year’s 11%. The ratio of non-performing growth also fell to 0.9% as compared to the previous year’s 3.6%. The prices of financial shares in the share market also grew in recent weeks which showed a growth of 0.52% and stood at Rs340.50.

Conclusion

Ujjivan bank is a paradigm for every NBFC who wants to convert itself into a private bank. This customer-centric bank is the perfect example of convenient banking which provides all kind of banking facilities and products. The bank has all kind facilities to make the banking experiences of its customers a seamless, smooth and interactive one. Ujjivan bank has realized the importance of keeping its pace up with the fast-changing technology and the bank is successful in doing so, as it has included advanced software, debit cards and banking techniques which have helped its customers to perform the banking transactions with ease.

Ujjivan bank has been helping the ‘economically poor’ and the middle class by providing them with the easy loan and saving options at very low-interest rates and return policies. Co-operative social responsibility has been it’s objective and this has borne sweet results for this small finance bank in growth and expansion in just 4 years and it has been in par with its other competitors in the banking industry.