A new product, SAFAL, is undergoing plans for launch by the State Bank Of India. The main aim of this initiative is to facilitate organic cotton growers without any credit history, said a top official of the country’s largest lender.
In order to generate business, the bank is incorporating Artificial Intelligence (AI), and Machine Learning (ML), SBI managing director C S Setty said speaking at a Fintech conference organised by Federation of Indian Chambers of Commerce and Industry (FICCI).
“We want to go beyond this so-called retail segment and reach out to… like farmers. Today I am not only giving crop loans… We are about to launch a product called Safe and Fast Agriculture Loan (SAFAL). There is a company which brought all the organic cotton growers and created a database on the basis of blockchain,” Setty said. Further information mentioned by him was that the purchaser of this cotton across the globe could validate whether the farmer is organically performing the cotton growth process.
“We are just taking the data and providing the credit linkage to them because they don’t have the credit history. They are not borrowers of crop loans, but we can pick them up because the technology has brought them together and provided the market visibility to them,” he added.
An overall 1.7 million loans were pre-approved with 21,000 crore business being booked employing this product at the time of COVID-19 lockdown. Setty described this as another significant use of AI and ML.
Based on the total productivity of data analytics by the bank, he said, “Our AI/ML department is not an experimental department, it is a business-oriented department. We have had a net income creation of about Rs 1,100 crore in the last two years.”
Presently, there are over 40 Machine Learning type models for bank applications, which are used across the spectrum. Currently, he said, the bank has more than 40 Machine for business, risk mitigation, fraud management. Setty claimed that the bank had constructed a capability which is unrivalled in the banking industry.
