In Part One of our Bank and Technology series we spoke about the technologies needed by Public Sector Banks, Private Sector Banks, and Foreign Banks and in Part two we narrated technologies desirable by Regional Rural Banks [RRB’s] and Cooperative Banks [ State and Urban Cooperative Banks]. Now in the final and concluding part of our Bank and Technology series would talk about the technology needs of Payment Banks and Small Finance Banks. We would also discuss the fintech firms in India, their product offerings and the banks they are helping to enable Digital Banking for their customers.
Although the Payments Banks in India are newly launched[in principle in 2015 and first payment bank was Airtel started in 2016] and the need of the hour, yet they need to adapt to some of the latest technologies to stand tall against their competitors.
| Who is the Target Audience | ||||
|---|---|---|---|---|
| 1.Airtel Payment Bank 2. Paytm Payment Bank 3. Vodafone M-Pesa |
They came into existence to serve – 1. Small businesses 2.Unorganized sector 3.Low-income households 4.Farmers and migrant workforce |
1. Mobile App | Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe. | |
| 2. e-KYC acceptance | Reducing carbon footprints would help the mother earth but also would speed up the process of essential services like Opening Account or Loan Reimbursements | |||
| 3. Use of Biometrics | Biometrics would help in reducing fraud and identifying potential security threats. | |||
| 4. Digital Wallets/e-wallets | Paying for monthly bills or shopping online, e-wallets could be handy for quick money needs to the customer. |
Small Finance banks that were launched to support the small business units, farmers and most importantly the unorganized sector of the economy for their empowerment and financial inclusion. Some of the essential technologies that could help Small Finance banks in attaching these individuals to Bank System are –
| Who is the Target Audience | ||||
|---|---|---|---|---|
| 1.Janalakshmi Small Finance Bank 2.Capital Lab Small Finance Bank 3.Disha Small Finance Bank |
They are not allowed to lend but would eagerly accept the deposits. Hence the target audience for them is 1.Small farmers 2.Unorganised workers 3.Small business units |
1. Mobile App | Launch of banking services via Mobile App and Internet helps customers in availing services anytime from anywhere across the globe | |
| 2. e-KYC acceptance | Reducing carbon footprints would help the mother earth but also would speed up the process of essential services like Opening Account or Loan Reimbursements | |||
| 3. Use of Biometrics | Biometrics would assist in reducing fraud and identifying potential security threats | |||
| 4. Agent Banking Solutions | With remote areas/rural areas not having enough bank branches services like Agent Banking, ATM, PoS or e-corners could add to get more customer satisfaction and business to banks |
We had a glimpse of different banks and their technology needs, let’s also look at the fintech firms in India that are trying to build a comprehensive banking solution to support the digital wave in India. While the list here mainly focuses on firms offering products to banks of rural areas, it also has firms providing crime surveillance solutions for fraud and thefts.
| Partners | ||
|---|---|---|
| Mobile Payment App to set up bank account and structure finances | RBL Bank, Bank of India, IDFC Bank | |
| Offers core banking to rural areas. Loans to women and self-help groups. | YES Bank, The Ratnakar Bank | |
| Offers the lowest power consuming ATM’s | Set up 545 ATM’s that includes 300 solar powered ATM’s for State Bank of India | |
| Offers no-frills bank accounts and deposit, withdrawals and remittance services to unbanked migrants via a mobile device | State Bank of India, Yes Bank, ICICI Bank | |
| Offers Core banking solutions, aadhaar based solutions, Payments via Mobile, Tablet, Agent Banking, etc | Bharat bank, Apna Sahkari Bank, Mahesh bank | |
| Offers Core banking, Agent banking, Mobile Banking, Business Intelligence, Different modes of payment solutions and Risk and Recovery Management | KUC Bank, Thenjipalam Cooperative Urban Bank, Malapurram Service Cooperative Bank | |
| Offers Core banking, AML compliance and financial crime surveillance, Lending management, and microfinance solution | 450 clients across 36 countries over 300 banks | |
| Offers cloud-based Mobile Banking, IMPS services, and switch, Aadhar enabled payment eKYC, etc | Nilambur Urban cooperative bank | |
| Offers Agent Banking and Payment Solution, Mobile Money Suite and Payment Switch . They also have solutions to Health tech for the rural population. | Oakfin Finance, Ebazara, Mannapuram, Mandeshi Bank |
References:
Payments BankList of banks in India
Grameen_BankWhat are Payment Banks? Why India Needs Payment Banks?
All you need to know about small finance banks
What are small finance banks and payment banks? How are they different from commercial banks?
Here’s how top 5 Indian banks use technology
Banks collaborate with new age fintech companies for rural banking
Impact of financial inclusion drive through co-operative banks – a study with special reference to chavara block
Performance Evaluation of Regional Rural Banks in India