where customers can deposit and receive payments. The service especially appeals to poor migrants from Bihar and Delhi, as they can easily send their money to their kin through Kirana Shops in Delhi. The relatives receive the money from a kirana shop present near their village.
In India, in order to promote Financial Inclusion amongst the unbanked, the RBI has undertaken numerous initiatives in a mission mode through a combination of strategies and has also introduced several measures to achieve greater Financial Inclusion. This includes simplifying the Know Your Customer( KYC) norms, opening of no-frills accounts, engaging Business Correspondents( BC), use of technology and formalizing branchless banking using BC model, where banks partner with third party agents to offer basic financial services like deposit, savings and credits on their behalf. Various leading technology providers like A Little World, Financial Information Network & Operations Ltd.( FINO), EKO, Atyati Technologies etc. have created their own end-to-end solutions to assist various banks to offer financial services in areas where branch based banking is not feasible economically.
REDEFINING THE ROLE OF KIRANA SHOP OWNERS( CSP)
The kirana shop mentioned here may not be always present in a particular village but villagers generally have a shop or place( a kind of Customer Service Point or CSP) from where they buy their basic necessities or consumer items. This shop might be present in a nearby town or city, which is generally the nearest market for villagers. The kirana shop owners often have good information about the people to whom they sell their goods. They also trade goods by extending credit to customers and hence, develop a fair understanding about the credit history of customers. These strengths of Kirana shop owners can be leveraged to access the targeted beneficiaries.
MAJOR ROAD BLOCKS
There are some key issues that need to be considered before implementing any mobile banking services in India. First is the need to provide an easily facilitated ID card. The process of tracking the constant migration of rural poor to urban areas can be eased with an ID card which can help them apply for the account. As adoption of UID card increases, we can hope it will help in solving the ID issue to a much larger extent.
The second challenge lies in getting trained and reliable agents. These agents can be either business correspondents or kirana shop owners. Agents are the single point of contact to customers. Hence, it is very important that customers trust agents with their hard earned money. It is also critical to develop the right incentive structure for agents, so they are motivated to work and develop relationships with customers who are predominantly poor.
THE FUTURE AHEAD
Following the global practices in mobile banking, it is very clear that one of the very basic needs of poor people is to have a secure place to save their money. For example, a recent study of urban rickshaw pullers in Delhi found that a total of 95 % of the respondents saved a portion of their earnings. People are even ready to pay money for this service rather than expecting an interest on savings.
If any such service needs to be developed in India; then firstly, we have to do a proper need identification study of the target consumers. The role of government can be that of a facilitator and regulator, rather than that of an implementing agency. A sustainable enterprise driven model needs to be developed. The point here is to adopt a financial inclusion strategy which is more demand driven and which addresses poor people ' s needs. RBI can play a proactive role in the mobile banking sphere by creating an amenable regulatory environment.
In our view, we can start with basic services like savings and remittances through Mobile banking. The primary reason for this is to develop trust among people. Once their trust is obtained, more services like payments for goods and services, micro credit re-payments, health insurance and later even cash transfers for poor can be added.
The delivery of basic banking services using mobile technology can prove to be an evolutionary step and provide enough scope to branchless banking to cover the so far unbanked customers. It can further reduce the customer reliance on branch based banking model. The first step, however, should be to develop trust among poor sections of society so that they are comfortable parting with their money. Even in Kenya, the success of M-PESA can be attributed to the trust factor which the customers associated with the company, Safaricom. Hence, it can be expected that with an increase of customer confidence over security issues, mobile technology can emerge as a key tool to offer fast and convenient banking services.
86