Enhanced Access and Service Excellence (EASE) Program

The full form of the EASE Program is Enhanced Access and Service Excellence (EASE) Program. In January 2018, the Indian government and Public Sector Banks (PSBs) launched the EASE Reforms Agenda, which was commissioned by the Indian Banks’ Association and authored by the Boston Consulting Group. The Indian Banks’ Organisation, established in 1946, represents Indian banks and financial institutions in Mumbai. The EASE Agenda’s goal is to achieve CLEAN and SMART banking. The EASE Reforms Index evaluates each PSB’s performance using more than 120 objective indicators and provides a transparent grading approach that enables banks to identify their strengths and areas for improvement. The objective is to foster healthy competition among PSBs and drive modernization efforts by emphasizing data analytics, automation, and digitization. The EASE program has been providing a common set of reform objectives for PSBs since its inception, with the aim of enhancing profitability, asset quality, customer service, and digital capabilities through new-age reforms.

Features of the EASE Program

• The government is urging rural banks to increase lending to sectors such as small businesses, education, housing, and tractors. 
• In order to make it simpler to lend money to the education sector, the government is considering raising the guarantee limit for education loans from Rs 7.5 lakh to Rs 10 lakh.
• The government’s aim is to enhance the profitability of Rural Regional Banks (RRBs) and promote increased credit availability to rural consumers for education, housing, and micro-businesses.
• The government’s plan is to improve the profitability of RRBs and increase credit access to rural consumers for education, housing, and micro-businesses. 
• This will be achieved by guiding RRBs to become more customer-friendly and competitive, and by leveraging their rural network and local understanding. 

Phases of EASE Reforms

EASE 1.0

According to the EASE 1.0 report, there was a noteworthy improvement in the performance of Public Sector Banks (PSBs) concerning the resolution of Non-Performing Assets (NPAs) in a transparent manner.

EASE 2.0

• EASE 2.0, which builds on EASE 1.0, introduced new reforms across six areas to ensure the transformation of PSBs is irreversible, improve their processes and systems, and achieve better results. 
• The EASE index measures PSBs’ performance based on more than 120 objective metrics in areas such as customer service, responsible banking, and financial inclusion. 
• The index’s transparent scoring system helps banks identify their strengths and weaknesses. Since the launch of EASE 2.0, PSBs have made significant progress in all six themes, with the biggest improvements in responsible banking, governance, HR, support for MSMEs, and credit off-take. 
• The overall EASE index score of PSBs has increased by 37% from March 2019 to March 2020, with the average score rising from 49.2 to 67.4 out of 100..

EASE 3.0

• It is a program initiated by the Indian government to provide modern and innovative financial services to young India. 
• It aims to digitize and improve the customer experience in public sector banks by introducing various features such as palm banking, banking on the go, and dial-a-loan. 
• The government has also implemented management reforms to increase the efficiency and effectiveness of public sector banks. 
• The program also emphasizes ethical finance, client reactivity, loan turn, and debt inclusion. 
• The themes of EASE 3.0 include smart lending, tech-enabled banking, institutionalized prudent banking, governance, and outcome-centric HR, and deepening financial inclusion and customer protection. 
• The program aims to bring effective solutions to the public sector banking industry, making it smarter and more high-tech. 
• Through these reforms, public sector banks in India are transitioning to digitized and modern finance to meet the aspirations of young India.

EASE 4.0

• EASE 4.0 is a set of reforms introduced by the Indian finance minister for Public Sector Banks (PSBs) to enable smarter banking. The main areas of focus are co-lending with non-banking firms, digital initiatives, agriculture financing, and technological resilience. The reforms emphasize data analytics, automation, and digitization.
• The key aspects of EASE 4.0 include promoting analytics-based systems for pre-approved loans, MSME loans, and EMI offers, improving loan initiation processes, and establishing call center-based retail and MSME customer outreach in regional languages. Additionally, there are plans to automate agricultural loans and collaborate with the financial ecosystem for increased digital payments in rural areas. The EASE Index will measure the performance of each PSB and provide a comparative evaluation based on objective metrics.
• It aims to promote customer-centric digital transformation in PSBs by committing to tech-enabled, simplified, and collaborative banking. The reform proposes several themes to achieve this objective, such as 24×7 banking, a focus on the North-East region, the establishment of a bad bank, raising funds outside the banking sector, and leveraging the FinTech sector.

EASE 5.0

• The EASE Next program’s EASE 5.0 ‘Common reforms agenda’ was launched by Ms. Nirmala Sitharaman, Minister of Finance and Corporate Affairs, via video-conferencing in New Delhi on June 8. 
• The program aims to help Public Sector Banks (PSBs) respond to changing customer needs, competition, and technology by prioritizing digital customer experience and integrated and inclusive banking.
• Each PSB will also develop a bank-specific three-year strategic roadmap that covers various topics, including business growth, profitability, risk, customer service, operations, and capability development. 
• It is important for banks to engage with their customers to understand their needs and expectations while developing strong security mechanisms as they upgrade their technology initiatives.

Evolution of the EASE Program

The EASE Reforms Agenda was launched in 2018 by the government and PSBs with the help of the Boston Consulting Group. EASE 1.0 resulted in significant improvements in resolving NPAs transparently. EASE 2.0 introduced new reform Action Points across six themes to promote responsible banking, customer responsiveness, credit off-take, financial inclusion and digitalization, governance, and HR. EASE 3.0 aimed to enhance banking experiences for customers by leveraging technology, with initiatives such as Dial-a-loan and PSBloansin59 minutes.com, partnerships with FinTechs and E-commerce companies, and tech-enabled agriculture lending. EASE 4.0 committed PSBs to customer-centric digital transformation through tech-enabled, simplified, and collaborative banking. EASE 5.0 will maintain its emphasis on improving digital customer experience and promoting integrated and inclusive banking using data-driven approaches in all areas.

Impact and Achievements of the EASE Program

• PSBs showed a significant improvement in the EASE Reforms Index during the financial year ending in March 2020, with an overall increase of 37%. 
• The participating banks continued their reforms journey and demonstrated progress in various reform areas. 
• EASE 1.0 and EASE 2.0 systematically addressed the root causes of weaknesses in PSBs and equipped the boards and leadership with effective governance, risk appetite frameworks, technology-driven risk assessment, and prudential underwriting systems, and focused recovery arrangements. 
• They also improved customer responsiveness, digitized lending for retail and MSMEs, established outcome-centric HR systems, and implemented specialized monitoring systems for time-bound action in respect of stress. However, sustaining the momentum of reforms is crucial for the PSBs to further improve performance and build the platform capabilities required for the future, as the changing India needs a revitalized banking sector.

Conclusion

PSBs faced declining performance from 2009 to 2015 due to accumulated stress, leading to a need for improvements in areas such as customer responsiveness, governance, HR, and digitization. The government launched the EASE reforms agenda to address these issues and promote overall improvement in PSBs. The EASE Reforms Index has shown significant progress across different metrics during EASE 1.0 and 2.0. EASE 3.0, launched in 2020-21, aims to build on the foundation established by the previous phases and transform PSBs into digitally and data-driven, tech-enabled NextGen banks.