Banking Tech summit: Reaching out to the bottom of pyramid


At a time when gigantic global corporations were dwarfed by the unprecedented financial crisis, Indian companies – retail, banking and insurance

alike – started recognising the potential of rural India. However, a lot of work remains to be done on this front, which calls for involvement from individuals, corporates and administrators, along with effective use of technology.

These issues came up for discussion at a key session on financial inclusion at the ET Banking Technology Summit. Amita Sharma, joint secretary, ministry of rural development and Umesh Chandra Sarangi, chairman, NABARD and Deepali Pant Joshi, chief general manager, Reserve Bank of India, shared the dais to highlight, among other things, role that technology is capable of playing in bridging the gap between banks and the unbanked population in the country.

Though having a bank account in itself does not mean financial inclusion, it is good beginning nevertheless, said Ms Pant Joshi, while pointing out that many co-operative banks and regional rural banks had not yet implemented core banking solutions in totality. “Till we leverage technology to the optimum level, we cannot reach the unbanked sections in the country,” she added.

Technology plays a key role in sustaining the entire framework of National Rural Employment Guarantee Act (NREGA), which guarantees a minimum level of income for poor households, thus reducing their dependence on loans from money lenders. The wages are transferred to post office and bank accounts, with the help of a hand-held device. “If the system collapses and the money transfer gets delayed, they will be forced to go back to the money lenders. That is why we are looking at technology to ensure that the transfer takes place within 15 days,” said Ms Sharma.

Mr Sarangi stressed on the need for reducing the distance between a branch and the customers. “This is not possible without the right tools. Technology can come to our aid in reaching the unreached – those who stay far away from the branches as well as those who are too poor to afford banking services. Now is the time to make the effort,” he said.

Continuing with this line of thought, at the concluding session of the conference, Nachiket Mor, president, ICICI Foundation for Inclusive Growth, made a presentation on how technology could become an enabler for financial inclusion.

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