Loan in 59 Minutes: Indian Bank has Rejected 77% of Applications, SBI 48%

The much-hyped loan in 59minutes scheme announced by prime minister Narendra Modi on Diwali last year has been found providing loans for less than 50% of applicants, reveals replies received under the Right to Information (RTI) Act. In fact, Indian Bank has rejected as many as 77% of applications that had received in-principle approval from the portal. Even State Bank of India (SBI), the largest State-run lender, has rejected as many as 48% applications it received from the portal specifically set up for fast processing of applications and giving in-principle approvals.  

According to information received from Allahabad Bank, Andhra Bank, Bank of Baroda, Bank of Maharashtra, Canara Bank, Corporation Bank, Indian Bank, Indian Overseas Bank, IDBI Bank, Oriental Bank of Commerce, Punjab and Sind Bank, Punjab National Bank, SBI, Syndicate Bank, UCO Bank, and United Bank of India, these lenders received 45,161 applications from the 59minute loan portal. Out of these, banks granted loans to 21,584 borrowers or 48% borrowers.  

Total loans sanctioned by these banks so far under the scheme is Rs6,606.34 crore. Considering the total number of borrowers, who were granted the loan, the average ticket size of the loan comes to Rs30.6 lakh.

From the borrowers perspective, Canara Bank seems to be a good bet to get the loan. Canara Bank received 2,134 applications out of which it sanctioned loan to 1,518 borrowers or 71% of the applicants.

On the other hand, Indian Bank turned out to be more cautious and had rejected 77% of applications. As per the RTI reply, Indian Bank received 1,429 applications, out of which it granted loan to just 23% or 335 borrowers.


As expected SBI, with its huge spread across the country, has provided loans of Rs2,198.77 crore as on 15 March 2019 to 5,993 borrowers. This number, however, is much lower than the total number of applicants which stands at 13,984. In other words, SBI has sanctioned loans to only 43% applicants.

Bank of Baroda (BoB), with sanctioned loans worth Rs1,012.1 crore stands at the second spot after SBI, in terms of amount of loan granted under the scheme. BoB had received 6,351 applications from the portal and had sanctioned loans to 3,666 borrowers. This means only 58% of applicants have received loan from the Bank.

Dena Bank, in its reply to the RTI application stated, "(The) Reserve Bank of India (RBI) has imposed credit embargo on 8 May 2018 on the Bank. (Dena) Bank has not done any fresh lending since then and has not participated in the 59minutes online portal."  

While the pitch for the loan in 59minute scheme was that anyone can get a loan in less than 60 minutes, all the borrower could get is just an in principle approval for submitting required documents.

CapitaWorld that operates portal clearly says the loan eligibility is determined by income, revenues, repayment capacity, existing credit facilities and any other criteria set by the lenders. All the portal does is collect documents, analyse correctness and authenticity of these documents and then give an eligibility letter or in-principle approval for the loan.   

The prime minister had announced that there would be a dedicated digital platform to enable micro, small and medium enterprises (MSMEs) secure in-principle approval for loan proposals of up to Rs1 crore in just 59 minutes. To enable quick and algorithmic processing of loan, Small Industries Development Bank of India (SIDBI), with help from CapitaWorld, set up Any MSME entrepreneur, who is seeking a loan, needs to fill up forms and provide details on this website.

For registration, as would like to call this process of collecting all information, there is no fee charged. However, if the borrower wants to receive an 'in-principle approval' he needs to pay Rs1,000, plus the applicable taxes.

In other words, while less than 50% of the applicants did not get any loan from the bank, CapitaWorld, received Rs1,000 from each applicant. As per the replies received under RTI, so far 45,161 applications were sent by the portal to banks for loans and the company had collected Rs4.51 crore as fees.

The most depressing aspect of the scheme, of course, is that public money from the public sector banks is being used again by politicians to dole out money under the garb of helping MSMEs.

Even if the borrower does not have collateral security, he/she can avail business loan through under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme. Please note, it is as per the lender's discretion and the lender can ask for collateral as per the latest guidelines.

This means since loans under the 59minutes scheme are fully guaranteed by CGTMSE, banks have no responsibility to recover the loan.

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    Anil Kumar

    2 years ago

    Good look behind the curtains of a scheme launched with publicity. Coming to the findings, 40 percent pass thru is a very good implementation - in the context of how government schemes usually remain only on paper. Didn't understand the distressing part. If it is a policy guideline to guarantee the loans by a government agency - for those not having collateral - I don't find any fault. Seems equivalent to so many dole out, concessions, targeted tax rates to stimulate specific sections of population / specific sectors. Also if 50+ percent applications are getting rejected - it shows banks are exercising some diligence, and not giving to all and sundry.


    2 years ago

    In case of issue of shares at a premium by listed companies, share premium shall not be considered as income. In case of unlisted companies premium can be considered as income in case the price charged at the time of issue of share is more than face value and is also higher than fair market value.Sep 29, 2017
    What about reliance Dasault venture at primiume 1100 % tax paid ?


    2 years ago

    Find out who's loan's passed are connected with any political party's or sangathan ?


    2 years ago

    Well summarised!

    Bank credit up 13.24% , deposits up 10% in FY19: RBI
    Signalling credit offtake, Reserve Bank of India data have shown banks have ended the 2018-2019 with record double digit disbursals for the second year consecutively after the under-5 per cent in FY17, which was the lowest in five decades.
    According to the RBI data released on Thursday, bank credit rose 13.24 per cent to Rs 97.67 lakh crore for the fortnight to March 29, while deposits grew by 10.03 per cent to Rs 125.72 lakh crore during the same period.
    This is the second consecutive double-digits credit growth after the same had declined to 4.54 per cent in FY17 at Rs 78.41 lakh crore, which was the lowest since 1963.
    In the year-ago fortnight, deposits were at Rs 114.26 lakh crore and advances at Rs 86.25 lakh crore. In FY17, aggregate deposits in the banking system grew a mere 6.7 per cent in 2017-18, while credit grew still lower at 4.54 per cent, the lowest since fiscal 1963. 
    Bank deposit growth had declined to a five-decade low in year to March 2017 as under the fading impact of demonetisation.
    During November-December 2016, banks received Rs 15.28 lakh crore as people deposited high denomination currency notes withdrawn from circulation on November 8. This led to aggregate deposits in the fiscal ended March 2017 to Rs 108 lakh crore. 
    In the previous fortnight to March 15, 2019 credit demand had grown by 14.46 per cent to Rs 95.53 lakh crore while deposits increased by 10.03 per cent to Rs 122.26 lakh crore, showed RBI data.
    On a year-on-year basis, non-food bank credit increased by 13.2 per cent in February 2019 as compared with an increase of 9.8 per cent in the year-ago period.
    Loans to the services sector almost doubled with a 23.7 per cent growth in February compared to 14.2 per cent in the same month last year.
    Advances to agriculture and allied activities increased by 7.5 per cent in February compared to an increase of 9 per cent in February 2018. 
    Credit to the industry rose by 5.6 per cent in February, up from an increase of 1 per cent in February 2018.
    Credit to the infrastructure, chemical and chemical products, and all engineering sectors accelerated. However, credit growth to basic metal & metal products, textiles, and food processing decelerated/contracted.
    Personal loans rose 16.7 per cent in February down from 20.4 per cent in February 2018.
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    Standard Chartered Pays Over USD1 billion to US, UK Authorities to Settle Iran Transfer Cases
    Standard Chartered PLC says it has agreed to pay USD947 million as monetary penalty to US agencies and other 102 million pound to UK Financial Conduct Authority (FCA) to settle cases related with money transfer to Iran during the sanction period. 
    In a statement StanChart says, "The Group accepts full responsibility for the violations and control deficiencies outlined in the resolution documents, the vast majority of which predated 2012 and none of which occurred after 2014. These violations include the actions of two former junior employees, who were aware of certain customers' Iranian connections and conspired with them to break the law, deceive the group and violate its policies."
    The lender says it has already set aside $900 million during fourth quarter of 2018 and will take further charge of $190 million in first quarter of 2019.
    The settlement follows investigation by the US prosecutors including Department of Justice (DOJ), the Office of the District Attorney for New York County, the New York State Department of Financial Services (DFS), the Board of Governors of the Federal Reserve System and the Treasury's Office of Foreign Assets Control and UK's FCA, which found the bank had processed transactions from Iranian companies and individuals through its Dubai branch. 
    Earlier in 2012 also, StanChart bought off $667 million in legal proceedings and had promised to tighten controls on transactions. 
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