Financial Inclusion

Catalyst
Financial Inclusion, FinTech Trends, Social Cause

Agent Bankers – The Catalyst Of Financial Inclusion In Emerging Markets

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After a short break, I am back again to take my readers on an another tour of agency banking. While my previous tours Agency banking and Bitcoin , importance of agent banker gave us a peek into what is agency banking and their importance in emerging markets, this time let’s tour and get a peek into the catalyst role played by agent bankers to bring about financial inclusion in emerging countries like India. My tour would be through info-graphics and the tour itinerary comprises of what makes agent bankers most apt for this role, how can agent bankers become catalysts, what tools can be used by them to become enablers of financial inclusion. Welcome aboard on the tour and here we are at our first halt to find out why agent bankers are the enablers of change. What makes agent bankers suitable for the catalyst role Ticking off our first destination on our itinerary let us move on to our final and last destination “The Signboard”. “The Signboard” showcases the tools provided by Teknospire (such as MAKash e-wallet and Lean banking solutions provided to the MannDeshi foundation ) that can be of use to the agent bankers in achieving financial inclusion. However, let us walk through the ways in which agent bankers can contribute to financial inclusion before we arrive at our landmark signboard. The ways by which agent bankers can become catalysts are :- They conduct classes to educate people on the financial matters and create financial awareness. They sign up with a financial institution like a bank and start providing agency banking services. They initially handhold the customers to use different tools and then gradually wean them off the hand-holding by either making the customers self -reliable or by building a hierarchy of agent bankers below them to handle specific areas. Having walked through the above ways we are here at the sign board that displays Teknospire’s tools. Request you to have a good look at it before we return back to our point of origin. Teknospire’s agent banking tool Hoping that this tour has been enjoyable, I hope my guests would urge more agent bankers to use Teknospire solutions to achieve financial inclusion.

GST
Financial Inclusion, Social Cause

GOI initiatives to boost Social and Financial Inclusion

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Hon’ble Indian Prime minister Mr. Narendra Modi said – I dream of Digital India where mobile and e-banking ensure financial inclusion. We might have heard many such quotes from our leaders, but what has been the ground reality? Has the government made any progress? What were the initiatives taken to boost social and financial inclusion? Demonetization? GST? MadeInIndia? JanDhanYojna Or DigitalIndia? Let’s dig in to explore – Images Source – Collage What is the Scope of Financial Inclusion? What all services could you think that needs to be included in Financial Inclusion? Deposits? Funds Transfer? Loans? While we do not have an official information on what all services need to be included in Financial Inclusion, but here are the basic banking services that could enable Social and Financial Inclusion – Access to Banks Accounts Instant Credits Instant micro loans for small business, education or agriculture Savings and Deposits Health Insurance Funds Transfer Investment or advisory services Pension for elderly individuals In general, any financial transaction through regulated channel as overall objective Challenges in Enabling Financial Inclusion in India India is the land of villages and farming, yet banks and banking haven’t reached around 19% of Indian population. Few of the challenges faced by Institutions, NGO’s, Fintech firms are – Missing Business model No digital reach and coverage Lower rate of education Setting up a bank branch locally is a costly affair Initiatives by GOI to Enable Social and Financial Inclusion Pradhan Mantri Jan Dhan Yojana One of the primary and significant schemes that allow individuals to open a bank account, basic banking no-frills account with nil/very low minimum balance as well as charges. Insurance and Pension Scheme GOI launched Pradhan Mantri Suraksha Bima Yojana (Accident Insurance), Atal Pension Yojana (Unorganized Sector) and Pradhan Mantri Jeevan Jyoti Yojana (Life Insurance), to enable social and economic security to the underprivileged sections of the society. MUDRA Bank to support Entrepreneurship Micro Units Development and Refinance Agency Bank (MUDRA Bank), launched in April 2015 provides loans at a low rate to enable enterprise for founders on rural/remote areas. Stand up India Another scheme initiated by GOI, each branch of public sector banks need to support one entrepreneur from Women and minority society. Direct Transfer of Government Benefits As we are witnessing LPG subsidies now getting credited directly to your accounts, on similar lines through Pahal Scheme GOI is keen to transfer grants and funds directly to beneficiaries account, removing the middle layer. Micro finance companies[MFC] MFC that provide micro loans to farmers, stall owners, women’s help in structuring the financial loan service and helping people from the money lenders debt trap. GST As cleartax defines Goods & Services Tax Law in India is a comprehensive, multi-stage, destination-based tax that will be levied on every value addition. GST also brings in the benefits of enabling financial inclusion by – Simplifying the Tax We all know that apart from CA’s, accountants and some learned, tax and its rules are still a bouncer to many of us. We have seen a debate on why the restaurant charged a VAT or service charge or service tax on my bill? Or have we not witnessed a Tv commercial showing how a farmer from his mobile phone ordered seeds for his farming? Do you think he would ever understand why he has to pay VAT? or if stays in Maharashtra why he has to pay Octroi ? Or how about a rural individual selling his handcrafted products to Maharashtra, would have a tough time to know why while processing in Pune Octroi charges applies. With uniform tax system, it’s easy to learning making it simpler for individuals to absorb it. One System Digitization Digitization automation demands one system that could track the tax channels. With multiple tax laws integrating them into one system is tough. Hence many times we have seen people ignoring paying the tax because there was no system to track or pay it outside the formal system via cash. With solutions available now on mobile devices, it’s easy for any rural person to track down his selling/purchasing in all cases. Unorganized Sectors to be Structured with no middlemen With initiatives like Digital India, Aadhaar linking to Bank accounts, PF and PAN cards, the GOI is trying to tie individuals to one identity. Taking a step further with the introduction of GST linking of the identification to tax system would be easy for small businesses and unorganized sector to follow formal tax rule. Just imagine a potter trying to sell his products across pan-India would now have a single identity card linked to his Bank account and GST Registration. Standard Pricing With formal tax-system retailers cannot mark product pricing as per their wish. GST also has an anti-profiteering clause, that mandates all businesses to pass on the benefits to the end customers. With such initiatives, one could expect products to be available and consumed in remote areas enhancing their standard of living. Use of technology With the ease of technology and availability of mobile phones – solutions like Agent banking are enabling financial inclusion in the remotest areas of the developing countries like India, Bangladesh, and Zimbabwe. General Purpose Credit Card [GCC] GCC allows the holder with a credit facility of up to 25,000 in rural and semi-urban bank branches. The primary objective of this scheme is to provide instant and hassle-free credit to its customers. How Teknospire a fintech firm is enabling Financial Inclusion in India Teknospire with its tagline Inspiring technologies for better living is a proud contributor to help in financial Inclusion. With its range of Fintech and HealthTech solutions to provide secure Agent Banking or Mobile Money suite or to credit grants to beneficiaries account , Teknospire is making it possible. GOI is putting extra efforts to bring the change, however firms like Teknospire are adding value to these plans and making execution a possibility with our skilled team and latest technology. The financial architecture in place thanks to GOI; we have the

Financial inclusion for rural people
Financial Inclusion, Social Cause

How important is an agent banker in the rural banking sector ?

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Financial inclusion for rural people In continuation to our earlier blog ”Benefits From Agency Banking”, this blog would highlight the importance of agent bankers in rural banking. For a country to be fully developed rural development has to take place. Of late rural development has become the new buzz word for the developing economies. The central government bodies, local government bodies and the financial institutions in these economies are the primary development providers to the rural areas and its residents. While the local authorities are developing the rural areas with better infrastructure facilities, the financial institutions are following suit by providing financial inclusion to the rural residents. Currently, huge chunk of the rural population are unbanked and prefer to remain unbanked due to reasons such as :- Lack of banking awareness No banking need Banks having an intimidating presence Limited bank presence in the particular rural area owing to high operational costs Distance to be covered to reach the bank Unsafe travelling conditions Lack of technological awareness Financial institutions especially rural banks of the developing economies play a crucial role in the rural financial development. To ensure a successful rural financial development, the rural banking sector needs to grow by laying thrust on :- Sustainable community- focused banking Networks value Providing advanced banking solutions apart from basic banking solutions Creation of banking awareness amongst the rural population Lower cost of reach Supporting their growth, the rural banking segment is opening up to policies that promote financial inclusion. Rural banks are steering away from traditional branches and are looking forward to alternative forms of banking to provide financial inclusion. A few steps taken by the rural banks in enhancing their development include :- Use of intermediaries, in-house or contract agent bankers and not their own staff or branch networks. The agencies employing agent bankers are postal outlets, retail outlets such as groceries stores, pharmacies, petrol pumps. Providing doorstep banking using latest technology and agent bankers. Customer service point /Agent Bankers Scope for rural banking sector development through rural financial inclusion has given rise to agency banking. But how important are the agent bankers to the rural banking sector? Agent bankers help in stepping up the success of thrust areas laid above. Also, they enhance financial inclusion of the unbanked by :- Being delivery channel in providing basic banking facilities like deposits, withdrawals, remittances at the doorstep or at a place closer to rural population than the banks. Offering banking services in a low-cost manner which wouldn’t be possible for the rural banks. Ensuring 24*7availability unlike rural bank branches that work for limited hours in a day. Providing accessibility to bill payments and other utility payment facilities. Educating about the need for banking and its advantages in a more efficient way than the banks. Exposing the unbanked to various banking forms using technology such as mobile banking. Mobile Banking In Rural Areas Increasing the customer base for the banks by signing up new customers using their wide social contacts. Developing a good rapport with the customers and urging them to make frequent use of banking services with confidence. A branch seems intimidating to the rural people and would not provide the same comfort level. Using cost effective technology for their transactions help the rural banking sector to be tech savvy. Such as the agent bankers banking suite and mobile money suite used by the Ndasenda’s agents for their transactions.   Agent bankers by providing benefits to the rural banks and the rural customers,have attained a prominent place in the rural banking sector and their importance in the rural development cannot be overlooked. References: International Journal of Management Research and Business Strategy Diversified Channels in Rural Banking Worldwide Agent Banking: Penetrating Markets, Rural Communities For Financial Inclusion

Use finger touch smart phone for order product online in studio
Financial Inclusion

Cashless Transactions And Non Tech Savvy Segments Of Our Society

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In one of our earlier blogs ”How #Demonetization is pushing us to go for #Cashless transactions” we had discussed the way demonetization has pushed us to opt for cashless transactions in continuation to that today‘s blog would discuss whether the non tech savvy people are ready to go cashless,what is holding them from going cashless and how we could help them out. In my view the non tech savvy is “NOT YET READY” to go cashless under the present circumstances. I refer to daily wage workers,people living below the poverty line,educated computer illiterate, people living in remote areas and not having any access to mobile or the internet ,senior citizens, the invalids as the Non tech savvy In the present circumstances I feel that the below factor play a major role in non tech savvy choosing the cash forms over cashless Not willing to come out of their comfort zones and learn the cashless modes especially by the educated computer illiterates. Absence of stringent cyber security laws which increases the chances of cyber thefts and loss of senior citizen’s savings .According to a recent TOI report almost 9 million people are not having any access to internet especially those in remote areas. With so many people not connected to the internet how will the government ‘s cashless dream be realized?? Expensive Smart phones and Personal Computer being out of reach of the daily wage workers and the people living below the poverty line. High internet costs Lack of power availability and Frequent Power cuts discharge phone battery .Absence of battery recharging facility restrains the citizens from going cashless. Nil bank accounts held by the daily workers and people living below the poverty line. With reasons being clear why the non tech savvy people are not willing to go tech savvy I strongly feel that financial institutions and the government will have to come to the forefront if the latter wants that the Non Tech savvy become tech savvy and go cashless One such way setting up agency banking in the remote areas, BPL areas with the help of fin tech companies Secondly help the daily workers to open accounts entitled for them such as No Frills Account , E wallet accounts,PMJY accounts Hold internet banking classes especially for the senior citizens and the computer illiterate and teach how to use laptops , smart phones how to do safe banking , which are the sites fit for browsing and how to know whether the site is genuine or not Setting up mobile and net banking kiosks in branches and remote ATMS Tying up with up with internet service providers to lower charges for online transactions. Currently while the government has launched the below schemes to help the non tech savvy Exempted the USSD charges of Rs 1.50 on financial transaction made on the regular phones (not the smart phones Launched the digital payment app called“BHIM .”This app based on the Unified User Interface (UPI).Through this app payments wimade or received from other non UPI accounts . The receiver need not have the BHIM app to transfer money Offers and cash back features on RuPay cards Launch of Jan Dhan Yojanas Waiving off service charges on the debit cards and online transactions.It can further pitch by Providing mobile battery recharge points at remote areas ,and basic power facility in remote areas. Launching schemes than ensures laptops and smart phone are within the purchasing power of the senior citizens and poor.similar to the laptops offered to poor in Tamil Nadu under the AMMA brand. Make internet connections available for everyone especially those living in the remote areas at affordable prices Implement stringent Cyber Security Laws Special mobiles and laptops for the invalids With government providing basic amenities, infrastructure for the senior citizens and poor living remote areas,incorporating stringent cyber laws its aim of going cashless dream would become easier. While awaiting for the above inputs come into play ,Our upcoming blog would discuss ” At the Ground Level Help Provided by the Government and Financial Institutions To Non Tech Savvy” References: India’s demonetisation – taking the bull by the horns

Fin-Inclusion
Financial Inclusion

How #Demonetization Could help in #FinancialInclusion and #Fintech Firms to #Empower #CashlessEconomy!

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One of the faces of demonetization – Our maid for several years knocks at our door, late in evening yesterday asking for money to buy milk for her son. I oblivious of the “demonization hula boo” started enquiring what did she do with the salary which I gave just a few days back.(Only because I knew she often had to spend money for husbands vagabond ways). She then pulls out a wad of note from her non-descript purse, let me tell u it was a huge wad, which would have been her saving from us for months and more houses in where she toils from morning to evening with a pleasant smile. Then the reality struck me – this is not so good face of this newest development of #AacheDin. This drove a hard reality of drilling once more the idea of tools of #Financial Inclusion to the rural sector of society and helping them save. Actually, this move by the government brings a lot of Indians into banking or at least agency banking. Here are the days when you can auto debit monthly salary to your helper, driver, maali. The Need of the Hour! People in Urban cities looking for shops where they could make a payment using Credit/Debit Card or Digital wallet The daily wagers in the tier one cities are being affected badly as people are out of cash and hence turn to shops where they can pay digitally. The individuals in tier two and three cities are waiting in long queue outside banks/ATM’s to withdraw cash. Marriages have been postponed due to a shortage of cash. The Other Side of the StoryIn the evening I went to buy vegetables from my regular stall owner. I asked him how much is the payment[I was lucky to get 2000 bucks from an ATM near me], he told me the amount and then asked my number? I was bit surprised, then he said – I will WhatsApp you my PayU link and you could pay it via that as cash is acting bit pricey these days. It was just a matter of 5 minutes and I was able to make the payment through my Net Banking! A step forward towards #FinancialInclusion. On the other hand, my cook after going with the trouble of cash issues handed me her account details and asked me to add it and make the payment for the next month salary. We were happy to skip the hassle of withdrawing cash and happy to know #Banking is the need for everyone. Looking at the “issues” and the adoption tactics by some of the individuals it does seem that #CashLessEconomy is the only viable solution and the need of the hour! How Could Fintech Solutions Help Societies in Financial Inclusions and adopting the #Cashless mode? Agency Banking – Connecting people with banks and bringing the services to their doorstep. Mobile Payment Solution – Linking buyer and seller that enable payment anytime anywhere. One touch payment solution – Biometric enabled , one-touch payment solution that could be handy to people like #dabbawallah or #chaiwallah Helping Local artisans with Virtual reality – Need for a pashmina shawl or the batik print kurta, use the virtual reality and review the products from your living room. And if you liked it, pay the seller through net banking and get the product delivered at your doorstep. Government Benefits directly into your account like Jan Dhan Yojna – No more stuffing money to middlemen to get government benefits. Fill the form online, scan and submit the required proofs and get the #benefit directly into your #bankaccount. Loans Solutions for Business Funding – Looking to start your own business, get an instant loan once you apply online and scan and submit the required proof. Be the next CEO! Get Expert Medical Treatment – How about consulting an expert doctor and paying him through #cashless mode for the rural people? Get Medicines and medical care at your doorstep – In need of medicines, you could not find in a store near you? Check out the Online Pharmacy and order them, and they could reach to you in a couple of days. Pay Your Kids Tuition Fees via Online Mode – Next time, you do not need to visit the faraway bank or the institute to fill your kid’s tuition fees. Use your Digital Wallet, Net Banking or Credit/Debit card and transfer the amount electronically. It worth remembering Nehru’s speech “Tryst With Destiny “ – At the stroke of the midnight hour, when the world sleeps, India will awake to life and freedom. A moment comes, which comes but rarely in history when we step out from the old to new, when an age ends, and when the soul of a nation, long suppressed, finds utterance. The New has just Begun… the age of #DigitalIndia the age of #CashlessEconomy , the age of #WhiteMoney , the age of #FinancialInclusion, the age to free ourselves from the burden …. the age to feel #weightless the age to go #Cashless. References: The open letter Paytm Advertisement which emphasizes on Jan Dhan Yojana and #FinancialInclusion is a welcome change

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