As the State Bank of India Chairman Om Prakash Bhatt prepares to step down in March after a five-year term, has expressed his support of the 8 percent teaser loan scheme. The scheme is said to come with no risk for the bank and its customers despite the RBI seeking higher provisioning from such loans.

However in Bhatt’s opinion the scheme is entirely transparent and finds it logical as opposed to the RBI’s concerns that it would reap adverse effects on the bank’s bottom line and share prices.

The scheme which was launched in 2009 provided a massive Rs 20,000 crore boost to a slowing economy that was impacted by global economic crisis. While the RBI has instructed all the banks to devote 70 percent of all their non-performing properties for provisioning the SBI has opted not to do this.

Mr. Bhatt addressing the media said that the teaser loans pulled in 2,92,000 customers with about 80 percent of them taking loans below Rs. 10 lakh and thus this scheme is suited for common man or the aam aadmi. Bhatt’s appointment, in June 2005, to take over as the reins of the SBI came as a surprise choice of the government.