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1 | P a g e
SCOPE OF BUSINESS CORRESPONDENTS FOR FINANCIAL INCLUSION IN
RURAL AREAS
SUBMITTED TO:
Centre for Microfinance Resaerch
Bankers Institute of Rural Development, LUCKNOW
SUBMITTED BY:
NEHA, Intern
CHANDRAGUPT INSTITUTE OF MANAGEMENT, PATNA
DATE: 1/07/2010
2 | P a g e
DECLARATION
I hereby declare that this dissertation entitled “Scope for business
correspondents for financial inclusion in rural areas” submitted in partial
fulfilment for the Award of Post Graduate Diploma in Business Administration
to Chandragupt Institute of Management Patna, was a record of independent
research work carried out by me.
I also declare that this dissertation was a result of my own efforts and has not
been submitted earlier for the award of any degree/ diploma to any other
University.
Neha
Chandragupt Institute of Management Patna.
3 | P a g e
ACKNOWLEDGEMENT
First and foremost, I extend my heartfelt gratitude towards Chandragupt
Institute of Management, Patna and BIRD, Luknow for giving me opportunity
to work on this project.
It had been an enriching experience for me to undergo my summer internship
under BIRD, which would have not been possible without help and support of
all the people around. I would like to express my sincere thanks to all the people
who supported me during the project.
I extend my sincerest gratitude and thank to Sri B.L.Mishra, Dr. Manesh
Chaubey and Prof. S.Dinda for mentoring and guiding me throughout my
internship. Without their constant guidance and support it would have been
impossible for me to complete the project in time. I would also like to thank the
Director of my institute Dr. V. Mukundadas for guiding me during my project.
I also take this opportunity to thank all the people from various Banks, SLBC
Government departments, Companies and clients for giving their valuable time,
suggestion and prompt answers for the questions intended for primary data
collection.
Last but not the least I thank all my friends and members of my family for
encouragement and moral support they had provided.
However, I accept the sole responsibility for any possible error and would be
extremely grateful to the readers of this project report if they bring such
mistakes to my notice.
Neha
Intern,
Chandragupt Institute of Management Patna.
4 | P a g e
CONTENTS
CONTENTS PAGE NO.
Chapter 1
Chapter 2
Chapter 3
Chapter 4
Chapter 5
Chapter 6
Chapter 7
Chapter 8
List of Tables
List of graphs
Abbreviations Used
Executive Summary
Introduction
Methodology
BC Model in India : An Insight
Bihar: Empowering the state through financial inclusion
Bihar Socio –Economic and Banking Profile
Present status of Banking and Financial Services and Banking
Profile of Bihar
Extent of Coverage of BC model in Bihar
Bank wise spread of BCs
CASE STUDIES:
CASE 1 :
Eko Aspire Foundation-SBI
CASE 2 :
Zero Mass Foundation-SBI
CASE 3 :
India Post-SBI
Clients Profile
Stakeholder analysis
Client’s Perspective
Conclusion and Recommendations
Annexures
Annexure I: details regarding number of BCs appointed and
accounts opened by banks (Public and private) Annexure II:
List of 19 districts and banks which successfully completed
100% financial inclusion.
Annexure III: Account opening form of Zero Mass
Foundation and Post Office
Bibliography
5
5
6-7
8-13
14-17
18-20
21-25
26-30
27-28
29-30
31-35
33-35
36-43
44-53
54-58
59-62
63-68
69-73
74-78
74-75
76
77-78
79
5 | P a g e
LIST OF TABLES
LIST OF GRAPHS
SERIAL
NO.
NAME PAGE
7.1.1 Age group wise classification of clients 59
7.2.1 Occupation pattern 59
7.3.1 Educational profile of clients 60
7.3.2 Classification of New and Old accounts 61
7.3.4 Number of new/old accounts for all the
three BCs
62
Table
No.
Name Page No.
2.3.1 Sample CSPs 20
4.2.1 Comparative data of Bihar and India for various socio
economic indicators
29
4.2.2 Banking profile of Bihar 30
5.1.1 Banks and their BCs working in different areas of
Bihar
32
5.2.2 Business of different BCs as on 31st May 2010. 33
6.1.1.6.1 Remuneration paid by Bank to BC(Eko Aspire) 42
6.1.1.6.2 Remuneration by BC to CSP 42
6.1.2.8.1 Remuneration paid by Bank to BC(Zero Mass) 52
6.1.2.8.2 Remuneration by BC to CSP 52
6.1.3.5.1 Remuneration paid by bank to PO 57
7.2.1 Crosstab of Occupational pattern and banking history
of clients
61
6 | P a g e
ABBRIVIATIONS USED
ALW A Little World
BC Business Correspondent
BC Business Correspondent
BF Business Facilitator
BIRD Bankers Institute of Rural Development
CSC Customer Service Centers
CSP Customer Service Points
EDGE Enhanced Data rates for GSM Evolution
EKO Eko Foundation
FI Financial Inclusion
FIF Financial Inclusion Fund
FITF Financial Inclusion Technology Fund
GOI Government Of India
GPRS General Packet Radio Service
KYC Know Your Customer
mFI Micro Finance Institution
MOU Memorandum Of Understanding
NABARD National Bank for Agriculture and Rural Development
NBFC Non Banking Financial Company
NGO Non Governmental Organization
PNB Punjab National Bank
7 | P a g e
PO Post Office
RBI Reserve Bank Of India
SBI State Bank of India
SLBC State Level Bankers Committee
ZMF/ZERO Zero Microfinance and Savings Support Foundation
8 | P a g e
EXECUTIVE SUMMARY
In order to meet the objective of financial inclusion and increasing outreach of
the banking sector to the unbanked, Reserve Bank of India, in January 2006
permitted banks to use intermediaries as Business Facilitators (BF) or Business
Correspondents (BC) for providing financial and banking services. The BCs
were allowed to conduct banking business as agents of the banks at places other
than the bank premises. The categories of entities that could act as BCs were
also specified. Since its inception in 2006, various banks had started promoting
the BC Model in all corners of the country. The Reserve Bank vide its circular
DBOD.No.BL.BC.58/22.01.001/2005-06 dated January 25, 2006 permitted
banks to utilize the services of non-governmental organizations (NGOs), micro-
finance institutions (other than Non-Banking Financial Companies) and other
civil society organizations as intermediaries in providing financial and banking
services through the use of Business Facilitator (BF) and Business
Correspondent (BC) models. Before analyzing the existing business
correspondent model as an effective tool for financial inclusion, let us examine
numerous key issues:
Were BCs bringing unbanked into formal banking system?
Were clients accepting the BC Model for opening bank account and to
what extent?
Reach and scope of BCs.
Various incentives and regulations for the banks, BC’s and other entities
involved?
How efficient and scalable were the Institutional set up between BC’s and
the promoting banks?
What other entities can be considered for becoming BC to increase the
reach of banking services.
9 | P a g e
The objective of the present study was to study the spread of BCs in Bihar,
acceptance of BCs by clients, problems faced by different stakeholders in
implementation of BC model and scope of BC in financial inclusion in rural
areas. The data were collected from 90 clients, seven CSPs, five banks, RBI,
NABARD and Government Department. Total number of sample size was 112.
Major findings and recommendations of the study are as under:
MAJOR FINDINGS:
Interview with BCs and clients revealed that BCs were not charging any
fees from clients. It was observed during interview that the payment to
the BCs was not being done regularly
It was seen during the interaction with BCs that they were using
technology except Post Office.
Interview with bankers revealed that the banks at state level had not
constituted the Grievance Redressal Committee as yet.
During the interview it was observed that KYC form was simplified by
the bank for BCs clients and BCs and the KYC norms were being
followed by the BCs
The common service points were tagged with the specific branch locally.
Transit cash insurance for BCs/CSPs was not taken by banks
A closer look of the attempts of Banks in financial inclusion revealed that
these inclusions were through “no frill accounts” which were lying in an
inoperative state as there was no transaction in almost all the accounts.
Thus the bank had paid only lip service to the cause of financial inclusion
by opening only savings account in the form of “no frill accounts” and
had not cared for other aspects like credit needs, financial literacy,
financial advice, credit, insurance and remittance.
10 | P a g e
Average population per branch is very high (18,395) in Bihar as
compared to all India figure (12,470). Even in districts where the number
of rural branches was high, most of them were poorly manned and poorly
managed
RECOMMENDATIONS:
The banks may act positively on regulatory framework on two specific
points of risk mitigation by taking transit cash insurance for BCs/CSPs
and setting up of grievance redressal committee.
As yet only three banks had appointed BCs. All the banks (commercial
banks and RRB) should appoint BCs for providing banking services to
unbanked area. Bihar Government has already created a wide network of
well equipped Vasudha Kendras under e-governance initiative of Central
Government. Three agencies were taking care of it. These were
SRE Infrastructure Finance Ltd.
In Patna, Magadh, Purnea, Munger and Tirhut commissionery.
Zoom Developers working in
Darbhanga and Bhagalpur.
SARK System Ltd. Working in
Saran and Kosi belt.
5798 Vasudha Kendras had already been opened by the above three agencies
against the target of 8463.
Similarly, primary agricultural cooperative societies (8463), Milk Producing
Cooperative Society (6200), Milk booth of COMPFED (6000), Angan Badi
Kendra (80797) may be used by the banks as BCs.
Banks must utilize these wide networks to scale up the BC model in Bihar.
11 | P a g e
Banks should simplify the procedure for appointment of BCs. Release of
fees to the BCs and simultaneously the charge should be reasonable so
that BC model should be viable.
Banks must take this initiative as one of their main business rather than
taking it as a social responsibility. BCs may scale up the business to earn
profit and in turn make financial inclusion a reality.
Efforts must be taken by banks to cover all the major components of
financial inclusion i.e. providing bank account, savings, affordable credit,
insurance, financial advice and payment and remittance.
Banks should make sincere effort to increase network of their branches in
the state to implement financial inclusion in true sense.
SBI may sort out the problem with India Post to continue the account
opening process which had been stopped by India Post at present.
Cash handling issues can be solved by adopting the “MILK ROUTE”
method COMPFED had adopted to collect milk from villages to district.
As technology was a necessity for
scaling up the BC Model, banks can help BC to bear the initial cost on
account of introducing technology which BC can pay back after a certain
time period.
Banks may be permitted to
collect reasonable service charge from the customer for delivering
services through BC model.
Banks may bear the initial set up
cost of the BCs and extend a handholding support to the BCs, at least
during the initial stages.
Banks should utilize the fund sanctioned by NABARD for financial
inclusion for capacity building of BC and increase financial inclusion.
12 | P a g e
It had been found that India Post was not utilizing technology for its BC
business. BCs must use technology to make the business more viable and
scalable.
BCs must take initiatives to build up confidence amongst people. It can
do so by conducting meeting/seminar with local people and make them
understand the concept of BC model.
BCs must start scaling up the business with operational effectiveness.
BCs have already identified the clients and thus can utilize this
information to make JLGs and SHGs and in turn avail the financial
support from NABARD through their bank. This will provide financial
sustainability to the system.
The Government of Bihar/banks may telecast advertisement of the BC
model and its benefits on the local Radio/TV channels which will create a
feel of confidence among the public.
Financial literacy and Credit Counseling Centers(FLCCs) may be utilized
to make the illiterate mass familiar with the practices of the BC to create
confidence among the general public.
NABARD should play proactive role in awareness creation, publicity,
improving financial literacy and use of technology for the financial
inclusion. Till the completion of this time of study report no disbursal had
been made by NABARD out of its two funds in the state of Bihar.
NABARD should launch aggressive marketing of BC products.
RBI should reconsider a few guidelines for BC operations such as:
Relaxing the limitation of area
for setting up a CSP
Limitation of time of one day for
depositing the money in bank
13 | P a g e
Though within strict review and guidelines companies offering BC
services should be allowed to work for profit rather than Section 25
companies only then scaling up of business can happen making financial
inclusion possible.
Presently not much feedback was available on implementation of BC as
nobody was monitoring it. Review and monitoring mechanism for the BC
model should be started in SLBC and DLCC meetings.
14 | P a g e
CHAPTER 1
INTRODUCTION
In the broader perspective, Financial Inclusion aimed at ‘connecting’ excluded
people including vast sections of disadvantaged and low income groups at an
affordable cost with the banking system. Access to formal financial system was
of critical importance for economic upliftment of the common man. Such access
was especially powerful for the poor as it provides them opportunities to build
savings, make investments and avail credit. Despite rapid expansion of the
banking network over the last four decades, majority of people in our country
especially the underprivileged sections of the society, did not have access to
basic banking services resulting in financial exclusion. In its landmark research
work titled “Building Inclusive Financial Sectors for Development”,(2006),
more popularly known as the Blue Book, the United Nations (UN) had raised
the basic question: “why were so many bankable people unbanked?”An
inclusive financial sector, the Blue Book says, would provide access to credit
for all “bankable” people, to insurance for all insurable people and to
remittances services for everyone. Access to finance by the poor and vulnerable
groups has to be recognized as a pre requisite for poverty reduction and social
cohesion. Apart from these benefits, financial inclusion imparts formal identity,
provides access to the payments system and to savings safety net like deposit
insurance.
15 | P a g e
FINANCIAL INCLUSION
According to 59th round NSSO Survey, 51.4% of farmer household were
financially excluded from formal / informal sources of credit (549 lakh
household out of 893 lakh). Even if the remaining population of farmer was
taken into consideration only 27% of agricultural household had access to
formal sources of credit. So it can be said that about 73% of the farmer
household had no access to formal sources of credit in the country.
A region wise study showed that the situation was most critical in Central,
Eastern and North-Eastern regions- having a concentration of 64% of all
financially excluded farmer households (from formal sources) in the country
(415.61 lakh households out of 649.54 lakh households). Overall indebtedness
to formal sources of finance alone was only 19.66% in these three regions
(4.09% for North-Eastern Region, 18.74% for Eastern Region and 22.41% for
Central Region)
16 | P a g e
Marginal farmer households constituted 66% of total farm households. Only
45% of these households were indebted to either formal or non formal sources
of finance (small farmers – 51%, medium farmers – 65.1% and large farmers –
66.4%). About 20% of indebted marginal farmer households had access to
formal sources of credit (medium farmers – 57.6% and large farmers – around
65%). Among non-cultivator households nearly 80% did not access credit from
any source.
In Bihar only 33%of agricultural household were indebted, out of which 23%
were from Institutional finance. It clearly indicated the severity of exclusion in
Bihar.
As per latest BPL survey the state (Bihar) was having 1.34 crore BPL families
(1.26 crore rural and .8 crore urban).The total population of Bihar is around 8.3
crore, 55% o population lying under poverty line.
The SHG movement could credit link 1.50 lakh SHGs (18lakh members) as on
March 2010. Similarly mFIs could provide credit to 6 lakh people in the state. It
meant that out of 1.34 crores BPL family only 24 lakh family were included by
formal sources, leaving a vast gap of 1.10 crores family. Hence the task for
financial inclusion in the state was gigantic and would be difficult and time
taking for inclusion of the excluded people from existing Banking system.
Hence there was need for alternate strategy and the RBI on the recommendation
of Rangarajan Committee implemented the use of BCs for financial inclusion.
(Source: Extent of Exclusion – NSSO Survey 59th Round in the situation assessment
survey on Indebtedness of Farmer Households (2003))
As shown in Annexture I, till May 2010, 129 BCs were identified by 48 banks
covering throughout the country covering 88.50 lakh clients. The details
position as pertaining to Bihar was indicated in Annexure II. In Bihar the pace
of implementation of BC model was poor and is in initial phase. Only three
banks namely SBI, Canara bank, and PNB had appointed BCs. Total number of
17 | P a g e
BCs appointed were only 10. Till 31st May 2010 they had opened 81902
accounts only. Although Canara and PNB had appointed BCs, but BCs had not
started their work at ground level.
To know the entire gamut of implementation of BC model in Bihar, a study
namely “scope of business correspondents for financial inclusion in rural areas”
was planned and conducted with following objectives:
1. Find out the reach and performance level of the BC model
2. Find out the acceptance level of BCs by clients
3. To study the problems being faced by various stakeholders
4. To study the scope of BC for financial inclusion in rural areas
18 | P a g e
CHAPTER 2
METHEDOLOGY
2.1 We deployed four step methodology i.e. Prepare, Observe, Analyse and
Report for collection of data as detailed below.
2.2 DATA COLLECTION
2.2.1. Secondary data/Information collection.
Secondary data had been collected from three different channels.
1. Reading materials: different articles available on internet and other sources.
2. Banks: Banks such as RBI, NABARD, SLBC, SBI, PNB, Canara bank,
Madhya Bihar Grameen Bank, Central bank and Union bank.
RBI being the Central Bank of country was the first one to be approached for
basic information. Some of very vital information such as the guidelines to
different banks by RBI, expected degree of seriousness with which different
Step I
Prepare
Step II
Observe
Developed detailed project
Plan including sampling.
Discussion with RBI,
NABARD, Banks, SLBC,
BCs, CSPs.
Finalized data collection
format and mechanism for
information capture.
Pretesting of framework of
in depth interview.
Conducted field
interviews.
Collected field data.
Monitored field data
periodically for accuracy.
Conducted periodic
process checks and
verifications.
Converted field data into
desired soft format.
Step III
Analyze
Summarized field data.
Conducted detailed data
analysis.
Step IV
Report
Developed detailed reports and
summary.
Prepared recommendations and
policy matrix.
19 | P a g e
banks had been asked to take up the project, number and names of bank which
had already initiated the projects, governing body for implementation and
monitoring of the projects were obtained from RBI.
The next visit was to State Level Bankers Committee, SLBC (SBI, Patna).
Various information and data regarding the present scenario of the Business
Correspondent Model in Bihar were collected from SLBC. After collection of
the required data from SLBC, visits were conducted to all the banks which had
undertaken the BC Model as a means for Financial Inclusion in rural Bihar.
3. Different BC: Information from the Business Correspondents, appointed by
the banks to open accounts on their behalf were collected by making visits to
their zonal office and centers.
2.2.2 Primary data/information collection
Primary data through a well designed pretested questionnaire were collected
from Customer Service Points of BCs and clients.
2.3 SAMPLING Out of three Banks, banks with highest number of BCs
were identified as sample. In this case SBI was having highest number of BCs.
Three BCs of SBI having opened the maximum number of accounts were
sampled. Accordingly the sampled BCs were
1. Eko Aspire Foundation
2. Zero Mass foundation
3. India Post
Based on the coverage of BCs, their following CSPs were sampled.
Table no. 2.3.1: Sample CSPs
Serial no. BCs CSP
20 | P a g e
1 EKO Aspire Deoghar(Sarath and Sarawan)
2 Zero Mass Foundation Purnia( Maranga)
3 India Post Bhagalpur( Amarpur and
Ghogha)
13 clients of each CSP were randomly selected for collection of data.
Total sample size was 107. Comprising Beneficiaries-90, CSP-7, Banks-5, RBI-
1, NABARD-1.
2.4 TABULATION AND ANALYSIS
The data collected were tabulated to facilitate easier sharing, referencing and
analysis.
2.5 SOFTWARE
We deployed MS Excel and SPSS for storing and analyzing the data.
2.6 REPORT WRITING Based on data and its analysis, detailed report was developed.
2.7 LIMITATION OF STUDY
1. It is only a sample study and the
results have been generalized. There can be a change in results if a
census is done.
2. Due to time constraint only one
bank and three BCs have been studied in details.
3. Most of the projects had just
started so real potential could not be concluded.
4. Only a limited no. of clients had
been interviewed.
21 | P a g e
CHAPTER 3
BC MODEL IN INDIA: AN INSIGHT Government of India launched Third party banking in 2006 with the intent of
achieving the milestone “Financial Inclusion” which included increasing the
sphere of formal banking sector to include unbanked .It build on the regulatory
inertia of prioritizing financial inclusion, particularly the RBI’s ‘no frill account
drive’ which began in November2005. For the drive, Dr. C.Rangarajan,
chairman of the PM’s Economic Advisory Committee, had advised that each
semi-urban / rural bank branch should open 250 such bank accounts annually
which, if implemented, would result in approximately 11.5 million customers
country wide. (Dr. C.Rangarajan 2008).
To further the objective of Financial Inclusion as well to leverage banking
services, two kinds of third party banking agents were created – Business
Facilitators(BF) who would primarily be involved in processing and opening
accounts and Business Correspondents who would , in addition to the BC
functions mobilize deposits and disburse credit on behalf of the bank.
Further RBI permitted banks to utilize the services of nongovernmental
organizations, mFI (except NBFCs) and other civil society organizations,
intermediateries in providing financial and banking services through the use of
above mentioned two models. As per the extant guidelines, the following
entities mentioned below can act as BCs of banks.
NGOs/ MFIs set up under Societies/ Trust Acts;
Societies registered under Mutually Aided Cooperative Societies Acts or
the Cooperative Societies Acts of States;
22 | P a g e
Section 25 companies that were stand alone entities or in which NBFCs,
banks, telecom companies and other corporate entities or their holding
companies do not had equity holdings in excess of 10%;
Post Offices and Retired bank employees, ex-servicemen and retired
government employees.
Individual owners of kirana/medical /Fair Price shops
Individual Public Call Office (PCO) operators
Agents of Small Savings schemes of Government of India/Insurance
Companies
Individuals who own Petrol Pumps
Retired teachers
Authorized functionaries of well run Self Help Groups (SHGs) which
were linked to banks
Non-deposit taking NBFCs in the nature of loan companies whose
microfinance portfolio was not less than 80% of their loan outstanding,
in the financially excluded districts as identified by the Committee on
Financial Inclusion(Chairman: Dr.C.Rangarajan)
While appointing individuals as BCs, banks had to ensure that these individuals
were permanent residents of the area in which they propose to operate as BCs
and also institute additional safeguards as appropriate to minimize agency risk.
3.2 Key components of the regulatory framework surrounding BCs
include:
3.2.1 Payment of commission/fees for engagement of BFs/BCs
While doing so the rate and the quantum of the same may be reviewed
periodically. Agreement with the BF/BC should specifically prohibit them from
23 | P a g e
charging any fee to the customers directly. Interview with BCs and clients
revealed that BCs were not charging any fees from clients. It was observed
during interview that the payment to the BCs was not being done regularly.
3.2.2 Risk mitigation
Since the service agreement involves legal and operational risks, inter alia,
sincere effort to adopt technology based solutions for managing the risks should
be in place. All agreements/contracts with the customer shall clearly specify that
the bank was responsible to the customer for acts of omission and commission
of the BF/BC. It was seen during the interaction with BCs that they were using
technology, Post Office being an exception. It was observed during the study
that Banks had not fulfilled the basic regulatory framework of risk mitigation as
transit cash insurance was not taken.
3.2.3 Grievance redressal
Such machinery within the bank premises for redressing complaints about
services rendered by BFs/BCs was advised to be constituted. Interview with
bankers revealed that the banks at State Level had not constituted the
Grievance Redressal Committee as yet.
3.2.4 Know Your Customer (KYC) norm
Such norms will continue to be the responsibilities of banks. Banks may
adopt a flexible approach within the parameters of such guidelines issued on
KYC from time to time. During the interview it was observed that KYC
form was simplified by the bank for BCs clients and BCs were adopting the
KYC norms.
Over the Operations and activities of the BCs by banks it has been stipulated
that every BC would be attached to and be under the oversight of specific
24 | P a g e
bank branch to be designated as the base branch. The common service points
were tagged with the specific branch locally.
The banks may act positively on regulatory framework on two specific
points of risk mitigation by taking transit cash insurance for BCs/CSPs and
setting up of Grievance Redressal Committee.
3.3 Financial Inclusion Fund created with NABARD
Two funds had been created by GOI with NABARD for financial inclusion of
the excluded population. These were Financial Inclusion Fund (FIF) and
Financial Inclusion Technology Fund (FITF). Each of the Funds shall consist of
an overall corpus of Rs. 500 crore, with initial funding to be contributed by the
GOI, Reserve Bank of India (RBI) and NABARD in a ratio of 40:40:20. The
funding would be contributed in a phased manner over a maximum period of
five years, depending upon utilisation of funds. A large number of activities had
been allowed to be funded with this fund including capacity building of BC/BF.
The agencies eligible to get this fund were
3.3.1. Eligible Institutions for FIF
Financial Institutions, viz., NABARD, Commercial Banks, Regional
Rural Banks and Cooperative Banks;
NGOs, MFIs, SHGs, Farmers’ Clubs, Local Level Associations, etc.;
Training and research organisations, academic institutions, universities;
Service providers like Insurance Companies (providing micro insurance
services), Post Offices, Railways, etc.;
Any other organisation whose objectives were in conformity with the
overall objectives of the FIF and were approved by the Advisory Board
from time to time.
25 | P a g e
3.3.2 Eligible Institutions for FITF
Financial Institutions, viz., NABARD, Commercial Banks, Regional
Rural Banks and Cooperative Banks;
NGOs, MFIs, SHGs, Farmers’ Clubs, Local Level Associations, etc.;
Technology Service providers and other service providers like Insurance
Companies (providing micro insurance services), Post Offices, Railways,
etc.;
Any other institution/ organisation whose objectives were in conformity
with the overall objectives of the FITF and were approved by the
Advisory Board.
3.3.3 Progress in Bihar:
Interview with NABARD official indicated that the progress of implementation
of this project in Bihar was very poor. Only one Proposal for technology in
Financial Inclusion of Rs 88 lakh has been sanctioned to Uttar Bihar Gramin
Bank in April 2010 The disbursement against these sanctions was nil.
NABARD should market these funds aggressively by organizing
seminar/meetings and distributing leaflets to speed up financial inclusion in the
State. NABARD may also use publicity mode for popularizing this scheme.
26 | P a g e
CHAPTER 4
BIHAR: EMPOWERING THE STATE
THROUGH FINANCIAL INCLUSION
As the financial exclusion was very high in Bihar, there was every need for the
formal banking system to provide better and integrated financial services to the
vast majority of the unbanked population in the state of Bihar. Given the natural
and human resource endowments, Bihar had a tremendous potential for growth
and development in general and financial inclusion in particular. There was a
need for partnership, innovative strategies and dedicated approach to harness the
potential. Various flagship programmes and key projects had been supporting
wide ranging developmental interventions in the State which were brainchild of
Central Government, various institutions including RBI regulated financial
inclusion through BC/BF model on pan India basis including Bihar.
A very wide network had been already created in Bihar by e-governance
scheme of Government of India. 5798 Common Service Centers (CSPs) had
already been set up known as “Vasudha Kendra” by the government against the
target of 8463 CSCs. This network could be leveraged upon by the Government
to increase the pace of financial inclusion.
Dairy cooperative COMPFED too was a very successful entity and had a very
wide network and reach in Bihar and this could also be considered for taking the
project further.
Financial Inclusion envisaged the provision of comprehensive financial services
including credit, to at least 50% of such households, by 2012 through
commercial banks and RRBs and the remaining households by
2015.Accordingly the vision statement for the State of Bihar was to achieve
financial inclusion by serving 6.5million mainly poor families in Bihar in
27 | P a g e
support of their livelihood through a range of financial services provided by the
formal banking system and mFIs. The banking system had already geared itself
to bring about financial inclusion to cover all families in the state by 2012
through opening of no frill accounts. In the first stage SLBC identified 19
districts for 100% financial inclusion, the details of which had been enclosed in
Annexure II. It was observed from the Annexure I, that overall achievement
stands at 95.61% in all the districts. A closer look of the attempts of Banks in
financial inclusion revealed that these inclusions were through no frill accounts.
A further enquiry in the field during the visits of CSP, it was observed that there
was no transaction in almost all accounts. The banks had provided only one
component of financial inclusion and had not cared for financial literacy,
financial advice, credit, insurance and remittance but not taking care of other
components, the banks had provided only lip service to the cause of financial
inclusion. In order to have effective financial inclusion efforts should be made
to cover all the components.
4.2Bihar Socio-Economic and Banking profile:
The decadal population growth rate of the state during 1991-2001was the
highest in the country at 28.62%.Of its total population, 89.5% lived in rural
areas. In terms of human development index, Bihar was at the lowest position
among all the major states. The State ranked at the 7th poorest with 57.22% of
its population under the poverty line (as per 2008 survey). Demographic
indicators like high birth rate and infant mortality rate, poor social service
delivery, and lack of economic opportunities due to limited infrastructure
development all point to a highly disadvantaged social and economic
conditions. Table below gives comparative data for Bihar and all India in
respect of several socio economic indicators.
Table no.4.2.1: Comparative data of Bihar and India for various socio
economic indicators
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Classification of Work Cultivators 29.3% 31.7%
Agricultural Labourers 48% 26.55
Artisans NA NA
Household/Cottage Industries 3.9% 4..2%
Other Workers 18.8% 37.6%
(source:Stat
e Focus Paper, NABARD, 2011-12)
To emerge as a developed state, focus was mandatory on infrastructural
improvement, industrial investments and other necessary fundamental needs
and corresponding opportunities for the people. The Government of Bihar’s
vision (as per white paper on state finances and development, 2006) was to
reduce the poverty headcount from 39% (1999) to 28% by 2015. Instead of
decreasing the poverty level has increased to 55% Present five year plan (2007-
2012) focused investment for socio-economic empowerment of women,
enhancing livelihood opportunities in the farm and nonfarm sectors and
participation of local level institutions to make service delivery more
accountable.
4.3 Present Status of Banking and Financial Services & Banking Profile of
Bihar:
As far as outreach and development of banking services were concerned, Bihar
was one of the most undeveloped states. The formal banking infrastructure
SOCIO-ECONOMIC PROFILE BIHAR INDIA Population 82.87m 1028.6m
Rural population 74.19m 742.4m
Population Density 880/sqkm 324/sqkm
Poverty Ratio 42.56% 26%
Overall Literacy Rate 47.50 65.20
Average land holding .75ha 1.57ha
Human development Index .367 .472
Infrastructure development index .260 .660
Per Capita Income 9214 25716
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available in the State is presented in the Table no.4.3 .Banking network in the
state comprised of only 5% of the all bank branches in the country, despite
being third largest in population. Out of a total of 4505 branches of various
banking entities, 56.85% of the branches were in the rural areas, 20.13% in
semi-urban areas and 16.82% were located in the urban centers (Source: State
Focus Paper, 2011-12, NABARD).This translated to a bank branch on average
every 20.9 square kilometers. In terms of population, branch population per
bank in Bihar was approximately 18,395 in comparison to the national average
of 12,470.The rural urban divide in Bihar was also very stark with each rural
branch serving 31,000 people as compared to 18,000 people in the urban areas.
Formal banking data shows another face of low penetration, as 37 out of 538
blocks in the state had no bank branch. Further private commercial banks were
concentrated in only a few urban centers in Bihar.
Table No. 4.3.1: Banking profile of Bihar compared to India
(Source:
Economic Survey Report2008-09)
(State
Focus Paper, NABARD, 2011-12)
Average population per branch was very high (18,395) in Bihar as compared to
all India figure (18,395). Banks should make sincere effort to increase network
of bank branches in the State to implement financial inclusion in true sense.
Even in districts where the number of rural branches was high, most of them
Banking profile Bihar India
Total no. Of bank
branches(including RRBs and co-
operative banks)
4505 82485
Per Branch Population 18,395 12,470
Credit deposit ratio 2009-10 32.13% 74.20%
Per capita bank deposit(2007)(Rs.) 5035 23382
Per capita credit (2007)(Rs) 1518 17541
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were poorly manned and poorly managed. The main reason for low CD ratio
was the absence of infrastructure facilities such as power, transport,
communication, agriculture extension services in the state. One of the factors
contributing to the low credit flow has been the weak loan recovery rates due to
lack of follow up, poor infrastructure and flood drought situation. The
cumulative recovery percentage for all banks in the state was still as low as
53.48%. Despite all the above challenges, Government of Bihar had taken many
initiatives to induce banks to address the issue of flow of credit .
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CHAPTER 5
EXTENT OF COVERAGE OF BC MODEL IN
BIHAR
In Bihar only 3 Banks namely SBI, PNB and Canara bank had appointed the
BCs which were as under:
Table 5.1.1: Banks and their BCs working in different areas of Bihar
It was apparent from the above table that only 10 BCs were appointed by the
only three banks. Out of these 10 BCs, 5 BCs of SBI had started operation at
ground level. Similarly the BCs of PNB had started operation on pilot basis.
BC of Canara bank had not yet started operation at field level.
5.2 The Bank wise coverage of BCs in the state is appended below
Banks
BC Operational Area
1. SBI 1. EkoAspire
Foundation
Gaya,Madhubani, Darbhanga
Samastipur,Siwan,Deoghar
2. ZeroMass
Foundation
Purnia,Supaul,Athmalgola,Patna,Gopalganj,W.
Champaran
3. India Post Every district
4. Swagram Madhubani
5. Drishtee Patna
6. Save Gaya
2. PNB 1. Samman
Foundation
2. Swagram
3. Kaushalya
Patna, Tinehri in Jehanabad, Ara, Gaya, Bihar
Sharif
3. Canara
bank
I25 Rural Middle
Services
Shekhpura
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Table No.5.2.1: Business of different BCs on 31st May 2010
Name of Bank
Name of BC No.of CSP Service offered
Total no of accounts
Deposit in lakh
Loan in Lakh
SBI Eko Aspire Foundation
174 A/c opening 31,000 49.05 -
Zero Mass 29 A/c opening Remittances
20,778 - -
Drishtee 4 A/c opening 143 2.41 -
SAVE 24 A/c opening 6,125 62 7
India Post 658 A/c opening 2,872 168 57
Total 865 60,918 281.46 64
PNB Samman Foundation
NA A/c opening 4,984 - -
Swagram NA A/c opening 11,000 - -
Kaushaliya NA A/c opening 5,000 - -
Total 20,984
TOTAL 81,902 281.46 64
The total number of accounts opened by all the BCs in state was 81902. Only
two BCs namely SAVE and India Post had given credit and that too a nominal
amount of Rs 64 lakh. It meant presently BCs were concentrating on opening of
savings accounts only. The operation BCs would not be viable by simply
opening the SB Accounts, as income generated through these operations was at
low ebb. The banks and BCs had to adopt followed two fold strategy to make
BCS operation viable:
1. Scale up the existing business of opening of accounts and banking
2. Diversifying business
3. Use of information and communication technology applications which
would reduce hassles and cost.
During the interaction with the stake holders it transpired that integration of
SHGs/LJGs model with financial inclusion would provide platform to BCS for
diversifying business. It was opined that BCs had already identified the clients
in the process of opening of Accounts. BCs should endeavour to form JLGs of
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male members of identified clients’ family and SHGs for women members. The
BCs can also avail financial support for SHGs/JLGs promotion from NABARD
through their bank. This would not only enlarge their business but also help in
economic development of clients.
5.2 Bank wise spread of BCs
5.2.1. State Bank of India:
5.2.1.1. Post Offices had been appointed as BC on pan India basis. Being a
government organization no security deposit had been taken. The MOU had
been signed with department of Posts wherein 658 Post Offices were
working as BC in Bihar/Jharkhand.
5.2.1.2. SAVE: Internet enabled Kiosks banking. It was operational in
Chakand block, Gaya district. There were 29 kiosks of SAVE till 30 July
2010.
5.2.1.3. EKO ASPIRE Foundation: Low cost banking by mobile phone. The
project was operational in 5 districts i.e., Madhubani, Darbhanga,
Samastipur, Siwan, Deoghar. They had opened more than 31,000 accounts
with approximate deposits of 49.05lakh. Total number of Customer Service
Points (CSP) in Bihar/Jharkhand was 174.
5.2.1.4. Zero Mass Foundation: Smart card based banking –The project was
functional since 2007-08.They were working in three districts Purnia, Supaul
and Patna. Total no of accounts opened till date was 20,778.
Taking together all the BCs of SBI had covered 5,495 no of villages and opened
60,918 accounts. The BCs were having 865 CSPs in the state. Their deposits
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were to the tune of Rs 281.46 lakh. They had provided credit to the tune of Rs
64.00 lakh.
Punjab National Bank:
There was a three tier system to appoint BC. They can be appointed at 1) circle
level, 2) Field GM level, 3) Head office level. The main function of BC was to
open savings account. Three BCs had been appointed by PNB:
1) Samman Foundation
2) Swagram Foundation
3) Kaushalya Foundation
Technology providers for PNB were 1) IL and FS, 2) TCS.
Places of operation of BCs of PNB in Bihar were:
• Patna: The project was operational in two areas of Patna i.e., Mussodi and
Teneri. Smart card based technology was used for opening the account
and operating it.
• ARA: The project was operational in two areas of ARA i.e. Koneria and
Udwanth Nagar.
• Gaya: The project was operational in two areas of Gaya i.e. Guraru and
Amraut.
• Bihar Sharif.
The BCs of PNB had opened 20984 savings bank accounts. Presently they were
not providing other facilities.
5.2.3. Canara Bank:
Canara Bank has started this project on pilot basis in a district near Patna called
Shekhkpura. A Bangalore based NGO, I25 Rural Middle Services had been
appointed as BC. The technology used by them was Biometric Smart Card and
technology partner was Ms Integra 62.
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The pilot project had been launched in January 2010, but could not start opening
of accounts till the date of visit in May 2010.
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CHAPTER 6
CASE STUDY OF SOME BCs
6.1 Case studies of 3 BCs of SBI has been attempted during the study which is
given ahead.
6.1.1. EKO ASPIRE FOUNDATION- SBI
6.1.1.1. Introduction: Eko Aspire Foundation and Eko India Financial Services
Pvt. Ltd. were formed in September 2007 to extend banking facilities in
unbanked areas via mobile phone-based technology and a network of retail
outlets called customer service points (CSPs). Eko Aspire Foundation was a
Section 25company, which had Bharti Airtel Ltd. one of Asia’s leading
integrated telecom service providers, as its technology partner. The Eko model
worked on the fundamental premise of giving everyone a bank account. It was
building a low cost financial services infrastructure to increase the reach of
financial institutions to the un-banked and to democratize financial services for
the un-banked in urban as well as rural areas: powered by innovation and
technology.
37 | P a g e
Eko was leveraging existing distribution networks, existing behavior and
interaction mechanisms to ensure that the barriers for adoption were very low.
The endeavor was to build a rapidly scalable model by addressing the
challenges of the existing models and by using mobile technology to help bring
down significantly the network cost. The Eko system, was aiming at providing
secure, simple and convenient financial services in a cost - effective and
scalable manner to the target segment.
6.1.1.2. Model: Public sector bank in collaboration with a section 25 company
as BC to make basic financial services available to the un-banked.
In the capacity of BC, appointed on February 23rd 2009, of SBI prime activity of
EKO was, to open no frill account for the rural unbanked clients and provide
them basic financial facility of deposit and withdrawals from this account. For
the purpose of opening the accounts EKO appoints CSPs, which in this case was
a local cloth merchant and a cement shop (Hansa Cloth Shop, Nirmal Cement
Agency).The area for operation was decided by the bank concerned. It had also
provided training to the CSP on usage of technology.
6.1.1.3. Location:
A visit to the EKO ASPIRE centers located at Sarwan and Sarath block of
Deoghar district was undertaken to make depth study of BC model.
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6.1.1.4. A BRIEF:
This was a case study of a 6 months old project launched by SBI in
collaboration with EKO ASPIRE FOUNDATION. SBI, a major public sector
bank, had appointed Eko Aspire as its BC and Eko on behalf of SBI provided
basic financial services to the clients. Eko uses mobile technology to open up no
frill accounts for the unbanked rural people. The basic model was depicted in
Fig 1:
Fig 6.1.1.4: Relation between Bank and BC.
In Bihar Eko Aspire Foundation has a total of 174 Customer Service Points
(CSPs). In Deoghar district a total of 14 BCs were present and there were 1CSP
each in Sarwan and Sarath block. A study of both the CSPs was done. The total
number of accounts opened by CSP at Sarwan and Sarath respectively was 80
and 110 in a period of 6 months. Though in terms of numbers the results could
not be called very impressive but the CSP vendors had high hope from the
project.
Although there was a bank branch of SBI in a close vicinity of around 1.5km
people were ready to open account via BC. People could have availed the
services from the bank branch itself but they choose to have it done through BC
as it was in a very prime location i.e. in market area and operation was hassle
free.
6.1.1.5. BC Operation:
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Zonal office of BC (Eko foundation) located at state headquarter appointed field
officer in each district. Field officer kept a check over all the CSP which were
appointed by the zonal office. Field Officer used to send the information to the
Zonal office.
The forms were filled by the CSP and then these completed forms were sent to
the nearest bank branch (Sarwan, Sarath), and also the zonal office of the
company. The branch office (bank) as well as zonal office of the company
maintains the database of clients.
The project being in inception phase the bank had delegated the power to the
branch manager of the implementing branch. So that operations could be carried
out without any hurdle.
As far as withdrawal from the savings account was concerned, paucity or
availability of little liquid cash (maximum Rs10,000) with the CSP , was a
hurdle in case withdrawal transactions increases arithmetically.
Technology used: The technology partner for EKO was Airtel. Eko uses mobile
based technology to open as well as operate the account. Mobile numbers issued
by the service provider, itself got converted as a saving account number for the
users and such arrangement eliminated the formal necessity of providing unique
number to clients. The account holder could carry on the transactions through
this account number. The procedure for opening the account had become very
easy and fast due to the usage of mobile banking. Such technology usage was
highly cost effective and the current tele density including the future forecast
would increase the scope of account opening exponentially. At present, the
instrument did not facilitate the transfer of electronic data to the server at the
receiving end which includes either the bank or the BC concerned.
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6.1.1.6. BC Services: Financial Structure
The SBI had appointed EKO as BC. Bank commissions were the primary
source of revenue for BCs. They were usually based on the number of new
clients enrolled, the volume of transactions, and client balances. Eko
foundation had entered into a contract with SBI. The decision has been taken by
SLBC branch of SBI (Patna) to appoint Eko as their Business Correspondent. A
consensus decision had been taken on the operational area and then the
respective local bank branches were informed about the project. The service
charge given to Eko by SBI is given in the Table no. 6.1.1.6.1. below.
Table no. 6.1.1.6.1: Remuneration by bank to BC
Service Remuneration
Opening bank account Rs 55 /Account
Transaction(debit/withdrawal) Rs 500/10,000
Eko had its own setup and staff to handle the business. The CSP which it
appoints were paid commissions for their service. The agreed amount for
payment of Sarwan CSP was given in table no. 6.1.1.6.1
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Table no. 6.1.1.6.1: Remuneration by BC to CSP
Service Remuneration
Opening bank account Rs 13 /Account
Transaction(debit/withdrawal) .03% of every transaction.
As a necessary condition for account opening, a client requires:
Voter I-Card( or any other government identity card)
Mobile and mobile no.
Photograph
6.1.1.7. Financial services offered:
While performing the task of a BC in Sarwan and Sarath, Eko Aspire opened
only basic no frill savings accounts. As of May 2010, total no. of accounts
opened were 80and 110 by Sarwan and Sarath CSPs respectively. In contrast to
other BCs, the regular transactions in accounts were observed.
6.1.1.8. Challenges Involved and clients Observations
While interacting with the clients, challenges and observations were mainly as
under:
Information about the BC Model/Financial services available for clients
Hassles in operations
Clients’ behavioral pattern
42 | P a g e
1. Information about the BC Model/Financial services available for
clients: Authentic information regarding BC was not given in the area.
2. Beneficiaries lacked confidence and trust on BCs: As many chit funds
had already cheated the people in past they were not able to trust this new
model.
3. Hassles in operation: One of the most important benefits of this model
was mobile banking that means a client can check his/her account by
himself. One of the basic problems was to make the customers learn the
process. Though very simple the basic fact of them being illiterate makes
the implementation part difficult. The clients having Airtel mobile no.
had the facility of calling a toll free no. (18001025432) and checking the
mini statement of the account but other people having numbers of other
mobile operator has to get the details through SMS which makes the
process difficult for them.
4. Client’s behavioral pattern: Socio-economic condition, low literacy
rates, vicious cycle of daily subsistence stress acted as a blockade in
implementation of the model.
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6.1.2 Zero Microfinance and Savings
Support Foundation-SBI
6.1.2.1. Introduction: A Little World (ALW) was the developer of ZERO,
India’s first domestic payment system with specific focus on reaching out to
masses with lowest available communication infrastructure. Zero Microfinance
and Savings Support Foundation, a Section 25 Company closely affiliated to
ALW, had been appointed as a Business Correspondent by 22 Banks, in 21
states of India, and provides field operations for the ZERO platforms. ZMF
manages the field force, account creation, appointment of Customer Service
Points (CSPs), management of cash and other logistics at the last mile. ZMF in
turn collaborated with strongly placed local organizations, district and state
administration to ensure smooth deployment and operations. ZMF created the
last mile operations network in villages, under pre-defined service agreements
with Banks and front-ends the delivery of full-featured transactional services on
behalf of Banks for Financial Inclusion on the ground.
6.1.2.2. Model: Public sector bank(SBI) in collaboration with a Section 25
company(ZMF) to make basic financial services available to the un-banked
area. The technology for operation was provided by A Little World. The
details of the model as under:-
Zero Mass Foundation (ZMF): Company Details
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Functions of ZMF:
As per a typical agreement between ZMF and a bank, ZMF’s scope of
services includes: Enrolment of customers for no-frills zero-balance
savings accounts and other account types that may be specified by the
Bank.
Enrolling, training and equipping of Customer Service Points (CSPs) in
villages to provide various kinds of transaction services including cash
deposit, cash withdrawal, transfer of money, payment of utility bills,
disbursal of loans, collection of loan installments, and cashless payments
at local remote merchant..
3rd party cash collection
Cashless payments at local and remote merchant establishments.
Management of cash
Functions of ALW:
A Little World is the technology provider for ZMF. It managed front-end
technology, back-end systems and 24x7 centralized Data Centre operations,
including:
Opening accounts with fingerprint + photo capture, using mobiles
End-to-end security and key management. Biometric de-duplication
Free open-source end-to-end account management system OR option of
connectivity to any Core Banking system
Headquarters Mumbai, India
Industry Financial Services
Type Non-Profit
Company Size 400 employees
Website http://www.alittleworld.com.
45 | P a g e
Card issuance and card management (photo-ID / smart cards)
Variety of transaction options at front end.
Web services.
Daily reporting to financial institutions, Government and others.
Predictive Cash Management System
6.1.2.3. Location:
A visit of Zero Mass center located at Maranga in Purnia District was
undertaken to make depth study of BC model.
The nearest bank branch i.e., Purnia Bazaar Branch was nearly 2-3kms from the
CSP. As the nearest bank branch was not at a distance local people would feel
convenient to go daily for depositing or withdrawing money.
Fig 6.1.2.3: CSP of Zero Mass
6.1.2.4. A Brief
Based on the agreement between zero mass foundation, a Section 25 company
and a public sector entity, SBI, ZMF overtook the role of BC and offered
financial services to clients. A sister company of ZMF, A little world provided
the technology for said operations. Case study included operational details,
client’s observation, challenges involved per se. It also unfolds critical issues
that surround BCs operations.
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Fig 6.1.2.4: Relation between Bank, BC and Technology partner.
6.1.2.5. BC Operation:
ZMF recruited and trained village based operators. Manned outlets for
transactions (incl. deposit, withdrawal, transfer).For performing operational
task, Zero Mass foundation appointed field officer who supervised and
controlled entire assigned activities of all the CSPs which were appointed by the
concerned Zonal Office, Patna. Further field officer sent entire activity
information both to the zonal office and nearest controlling bank branch.
The forms were filled by the CSP and then these completed forms were sent to
the nearest bank branch (SBI, Purnia Bazaar Branch), and also the zonal office
of the company. The Purnia branch office (bank) as well as zonal office of the
company maintains the database of clients.
Such project was under the supervision and control of the bank manager of the
assigned local bank branch.
The financial sustainability issue did not arise even when the primary result of
opening saving account was not very successful. Below mentioned data reveales
struggling status of entire model.
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All the CSPs working under Purnia Bazar Branch were not having any
information about 2900 requisition for account opening, as out of 3500 only 600
met the fate of being open and functional. The role of concerned zonal office
was not performed well.
There was also an evidence of deviation of BC from the service agreement
especially on account of commission paid to CSP by the BC. In this case,
evidence showing commission paid (Rs 4/account opening) and agreement for
commission was Rs 8/account opening. Further, grievances of CSPs majorly
included non-cooperation of Bank in making arrangement of cash for
withdrawals exceeding Rs 10,000. In one case, even issues regarding
remittances were noticed as the account balance for deposit from outside base
branch were not paid on time from the agency concerned.
6.1.2.6. CSP Field activities and norms for opening account:
Below mentioned were the steps involved for opening of an Account:
In the first step, all the necessary information of a client was gathered and
stored on a system.
Secondly, requisition form for account opening was filled and it included
ZSN no. and form id. The ZSN no. itself acted as an account number for
further financial transaction and services.
Complete filled form for account opening was sent to the bank.
6.1.2.7. Technology used: While performing BC Operations ZMS customer
service provider were heavily dependent on ALWs mobile phone specially
designed for agent banking.This device had the capacity to store customers’
information. In addition biometric data like finger prints and photographs were
also stored in the device.Its technology transmits transactions to the ALW back
end server.The technology used in the device was GPRS or EDGE and it has the
capacity to transmitt data very fast.
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Fig 6.1.2.7(I): Mini statement from F.B. Machine
Fig 6.1.2.7(II) Form, F.B.Machine, Mobile
device
Using this device was fairly simple and it included imprint of six fingers on the
device sensor and it was automatically stored in it. Facility for snapshot was
also there in the mobile device. Total kit includes a mobile phone and a F.B
machine and the two as one device performs the task of above mentioned
process for saving information.
Fig 6.1.2.7(III) : Mobile Banking
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Mobile transaction Finger print taken on F.B Smart Card
Machine
6.1.2.8. BC Services: Financial Structure
Bank commissions were the primary source of revenue for BCs. They were
usually based on the number of new clients enrolled, the volume of transactions,
and client balances. Zero Mass foundation has entered into a contract with
senior management of SBI. SLBC in the state approved Zero Mass to carry out
Business Correspondent role. A joint decision in this regard for the operational
areas and subsequent role of local bank branch regarding the project was taken.
The commission given to by SBI was given in the table 6.1.
Zero Mass has its own setup and staff to handle the business. The CSP which it
appoints were paid commissions for their service. The agreed amount for
payment of CSP in Maranga, Purnia is given in Table no. 6.1.2.8.1.
Table no. 6.1.2.8.1: Remuneration paid by Bank to BC
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Service Remuneration
Opening bank account Rs 20/Account
Transaction(debit/withdrawal) Rs 500/Rs10,000
Table no. 6.1.2.8.2: Remuneration paid by BC to CSP
Service Remuneration
Opening bank account Rs 8/Account
Transaction(debit/withdrawal) .3%of every transaction
Cost target for each device set in a Panchayat (NFC mobile + printer +
Fingerprint scanner + solar charger) was Rs. 10,000.It was borne by the
Company.
A security deposit of Rs 30,000 was given
to company by the appointed CSPs.
Institutional deposit of Rs 10, 00,000 was
deposited by the company to the bank.
6.1.2.9. Financial services offered:
While performing the task of BC in Maranga, Purnia, Zero Mass offered only
basic no frill savings account. More importantly in almost majority of accounts,
necessary transactions were not in place. As a necessary condition for account
opening, a client requires:
Voter I-Card( or any other government identity card)
Mobile and mobile no.
Photograph
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Challenges Involved and clients Observations
While interacting with the clients challenges and observations were mainly as
under:
Information about the BC Model/Financial services available for clients
Hassles in operations
Clients’ behavioral pattern
1. Information about the BC Model/Financial services available for
clients: Though in earlier case it was found that clients information level
were abysmally low here in case of Zero mass the situation was different.
The clients understood the need of bank account and were interested in
having their account opened in nearby vicinity. They had accepted the
concept of branchless banking and wanted to avail the service.
2. Hassle free operation: One of the most important benefits of this model
was that client didn’t have to visit bank for getting mini statement. He/Se
could get a mini statement from the nearest CSP. The customer just had
to provide the ZSN no. and the mini statement was provided in a printed
form to them by CSP.A hard copy of the statement helped the clients to
develop a kind of faith on the company.
3. Client’s behavioral pattern: In this case also socio-economic condition,
low literacy rates, vicious cycle of daily subsistence stress acted as a
blockade in implementation of the model.
6.1.3. INDIA POST-SBI
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6.1.3.1. Model: Public sector bank in collaboration with an Agency of
the Government of India to make basic financial services available to the un-
banked.
6.1.3.2. Location: BCs were located at Amarpur and Ghogha. Amarpur was a
block of Banka district in Bihar. The district, a part of Bhagalpur Division, has
its headquarters at Banka town. The district occupies an area of 3018 km² and
has a population of 1,608,773 (2001 census). Ghogha was located in Bhagalpur
district. The district occupies an area of 2570 km² and has a total population of
1,909,967 and rural population of 1,566,518(Bihar.nic.in).
Although a bank branch of SBI was operational in the immediate next building,
people were ready to open accounts through P.O. In this case the problem was
not of unavailability of bank branch but tedious and complicated process of
opening bank account. The procedure for opening bank account was very easy
through BC and so people especially from rural background felt more
comfortable with opening a bank account through BC. There were two other
factors which attracted people to open account through PO, one was the kind of
reputation it had built and other was its vast network.
6.1.3.3. A BRIEF:
This was a case study of a 1year old project launched by SBI in collaboration
with India Post. SBI a major public sector bank had appointed India Post as its
BC and P.O on behalf of SBI provides basic financial services to the clients.
The technology usage was not found in this case. P.O. still was working on
paper and conventional mode of opening the account was used.
Fig 6.1.3.3: Relation between Bank and BC
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6.1.3.4. BC Operations:
The operational structure of BC in this case was very simple. The top
management of both bank and PO has mutually taken a decision to leverage
upon the network of PO in India to open accounts and fasten the pace of
financial inclusion. PO in every district of India was acting as a BC of SBI. For
the bank, motive was very clear that they want to cut cost by not opening new
branches and for PO, it has become a new source of revenue.
The KYC forms were filled up by the PO in the block and the filled up form
was sent to the assigned bank branch. The data was maintained by both bank as
well as PO. After the account was opened bank gave the passbook to the client
and they could do further transactions from bank.
6.1.3.5. BC Services: Financial Structure
As for the other BC in the case of PO also remuneration by bank was paid in
terms of commission. They were based on the number of new clients enrolled,
the volume of transactions, and client balances. The decision has been taken
jointly by higher managerial level of both bank and P.O. A joint decision has
been taken on the operational area and then the respective local bank branches
were informed about the project. The remuneration given to P.O was given in
the table no. 6.1.3.5.1.
Table 6.1.3.5.1 : Remuneration paid by bank to PO
Service
Remuneration
Opening bank account Rs 50 /Account
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Transaction(debit/withdrawal) Rs 500/10,000
6.1.3.6. Financial services offered:
While performing the task of a BC in Amarpur and Ghogha, Bhagalpur, PO
offered services of only opening of basic no frill savings accounts. As of May
2010, total no. of accounts opened at Amarpur and Ghogha were 115 and 95
respectively. After opening the above mentioned number of accounts PO
stopped opening the accounts. The problem faced according to them was non
cooperative attitude of banks. On the other hand while the visit to bank was
conducted it was found that they were already overloaded with work and there
was no possibility they could open the account in less than 15days, while PO
asked them to open the account within 2 days.
Requirement for the account opening are:
Voter I-Card (or any other government identity card, even id
confirmation from sarpanch can also be accepted as proof for
identification)
Photograph
Signature/thumb impression.
6.1.3.7. Challenges Involved and clients Observations
This relatively unsuccessful pilot has shown that cooperation between the bank
and the BC was essential. Post Office being one of the most trusted institutions
in India could be instrumental in making BC Model successful. The trust P.O
enjoys together with their vast network can be leveraged to further accelerate
the growth of Business Correspondent Model and convert the dream of financial
inclusion into reality.
55 | P a g e
Clients in this case were ready to open account through P.O. The only complain
they had was slow processing (15 days to open account) but compared to other
cases their processing time was much lower. On this observation one could
conclude that there was a high demand from the customers’ side and P.O must
resume the process without any further delay. The misunderstanding between
bank branch and the P.O. may be removed by higher-ups in the banks and the
P.O.
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CHAPTER 7
CLIENTS PROFILE
7.1. AGE GROUP PROFILE
Age group wise disbursement of the sampled clients was given below in the
Pie-chart.
Graph no. 7.1.1. Age group wise classification of clients
From the above chart it was evident that 86% of the clients were in working age
group.
7.2. Occupational Pattern
The occupational pattern of the clients was given below in the Pie-chart
Graph 7.2.1: Occupational pattern of clients
It appeared from the above graph that sampled beneficiaries were well
distributed among major occupation.
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Table no 7.2.1: Crosstab of Occupational pattern and banking history of
clients.
occupation
account Total New(Throu
gh BC)
Old
(Banks)
farmer 12 4 16
labour 22 1 23
shopkeeper 12 7 19
vendor 29 3 32
Total 75 15 90
The table above tries to establish a relationship between the types of occupation
the observed clients were in and banking history of the client. It has been found
that except for the shopkeepers, clients into other occupation majorly opened
accounts(new account holder) through BCS. Thus it can be safely assumed that
the model was being successful in including financially excluded people.
7.3. EDUCATIONAL PROFILE
The education profiles of the sampled beneficiaries are given below.
Graph no. 7.3.1: Education profile of the clients
It was observed from the educational profile that 67% of the sampled clients
were illiterate. It meant BCs were also giving due importance to illiterate
clients.
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7.4. No. of accounts opened after the BC operation (new) and no. of old
accounts:
The classification of client based on new accounts and old account is given
below in the Pie-chart.
Graph no. 7.3.2: Classification of new and old accounts
It was evident from the above chart that 83% of the clients had new accounts i.e.
they had opened the accounts for the first time. 17% of the clients although
were having accounts, but opened accounts again with the help of BCs to save
time and cost of travel.
The Bar Chart of the three sampled BCs for the new and old account is given
below.
Graph no.7.3.4 : Classification of new and old accounts for all the three
BCs.
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CHAPTER 8
STAKEHOLDER ANALYSIS
8.1. This part of the study was done to analyse various pros and cons of the
model, according to different stakeholders. The purpose of the analysis was to
enumerate all the factors which were playing role to make BC model a success
or failure. To start with first of all it was important to mention various
stakeholders of the project. There were broadly four stakeholders who can be
associated with this model, they were:
Government
Banks
Business Correspondents
Clients
8.1.1. Government: Through discussions was held with Government
departments particularly Department of Institutional finance, Rural
Development Dept., Science and technology Dept. and Cooperative Dept.
Government was giving much thrust for financial inclusion and reviewing the
progress in each SLBC meeting particularly regarding appointment of BC by
banks. Government Dept pointed out that 100% financial inclusion had been
achieved in 19 districts. The detail of the same is provided in ANNEXTURE II.
Rest of 19 districts has been selected for 100% financial inclusion by the year
2012. The Government Dept. further pointed out that banks were achieving
target of financial inclusion by opening simply no frill savings accounts, which
also turned into non-operative/dormant accounts in due course. Government
officials were of the view that BC model would prove effective in achieving
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100% financial inclusion. For scaling up the BC model concepts State
Government officials offered following suggestions:
Opening of commercial Bank
branches in unbanked block and other rural area to be at par with national
average of serving population per branch.
Use of strength of Bihar such as
Common Service Center(Vasudha Kendra) under e-governance scheme,
milk producers co-operative society, Angan Bari and PACS
a) Common Service Center(Vasudha
Kendra) set up under e-governance Scheme.
S.No. Name of organisation Area of operation
1. SRE Infrastructure Patna,Magadh,Purnea,Munge and Trihut
commissionary
2. Zoom Developers Darbhanga and Bhagalpur
3. SARK System Ltd. Saran and Kosi region
b) Milk producing co-operative
society (COMPFED) :
Total number of milk producers cooperatives : 6200
Villages covered : 7750
Retail outlet of Sudha(COMPFED) : 6000
Towns covered : 84
c) Angan Bari Kendra: 80797 angan
bari centers have been established across the state
under ICDS program.
d) PACS: 8463 PACS were working
in Bihar.
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Change of mindset of bankers
towards financial inclusion concept is essential. Presently bankers think
opening of no frill accounts as financial inclusion. They have to change
their mindset and engage them in actual financial inclusion by providing
at least saving, credit, insurance and financial advice.
Pro active role by banks in
appointing BC. The pro-active role is required from all the banks i.e.
Commercial Bank, RRB and Co-operative. At the time of study only 3
commercial banks had appointed in total 7 BCs. All the banks are
required to expedite their effort and develop suitable strategy for
enlarging BC model concept.
Regular reviews of progress
although done in SLBC. There is need to review progress of bank
controlling office level, BLBC and DLCC.
Capacity building of staff of
banks
Simplification of procedure in
appointing BCs.
Use of technology
8.1.2. Banks Perspective: Opening a bank branch in areas where population was
around two thousand would have been a very costly affair. Maintaining
infrastructure, human resources and meeting other operational expenses for
every such branch, would have overburdened the banks’ expenditure. Business
Correspondent Model has made the whole process easy as well as financially
viable.
The various concerns of the banks were as under:
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Poor staff positioning in rural
branches forced the branch not to take any extra burden and thus they had
delaying attitude towards BCs.
The bank instead of trying to
make it a business opportunity was considering it as a social
responsibility. Although if taken seriously and implemented in a proper
way the Business Correspondent model as high potential to become a
profitable business for the banks as well. The best part for the bank in this
kind of arrangement was to earn extra profit and a chance to increase
market share as the concept was very new.
Capacity of bank staff to handle
BC model. Bank staffs were not conversant with BC model and hence
adopting delaying tactics. There should be proper training of the
employees to tackle BC model.
The infrastructure like power and
poor connectivity also posed problem in the use of technology and
scaling up of BC model.
Progress of achievement was less.
The banks should play proactive role and develop strategy for appointing
and monitoring the operation of BC.
8.1.3. Business Correspondents: Business Correspondents see a very high
growth in the sector and, therefore, were hopeful to gain out of it. A large pool
of rural population was devoid of financial services. Opening bank accounts
was just the beginning of it and as financial inclusion comprises of five other
services excluding account opening, BC can tap the potential and gain out of it.
The problems of BC were:
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BCs were expected to work on no
profit basis: Any business would prosper only when it was self
sustainable. Therefore for making the model successful it was very
important to rethink on this part of the policy.
They had to compulsorily operate
within 15kms (rural)/5kms (urban) of their linked branch.
Mandatory settlement of cash with bank on the same day or at the most
second day: It was a well known fact that the commutation part in rural
areas of our country was not very good. It becomes very difficult and
even costly for BC to make settlement every day. Therefore it was
believed that modification to this rule was also necessary for making the
model sustainable.
Fixation of transactional amount
per day makes it difficult to scale up the business: It has been observed
that both Eko and Zero Mass CSP were dissatisfied on this front. They
were in favour of, if not unlimited at least increase the limitations for
transactional amount.
Scaling of business was very low
affecting profitability and viability. They had to scale up their operation
to make it viable.
Fixation of cash limit of Rs
10,000 made it difficult to scale up the business. It had been observed that
both Eko and Zero Mass CSP were dissatisfied on this front. They were
in favour of, increasing the limitation for transactional amount.
Process of sanctioning/appointing
BCs should be simplified. Appointment of BC should be done without
delay.
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Difficulties in getting
identification of residential proof for opening of account. Government
should help in this regard by issuing a certificate from panchayat.
Regular payment to BC: In some
organization there were problem in making regular payment of service
charge. There should not be any delay in making payments. Banks and
BC both should be particular on this count.
Risk coverage of BCs: Transit
cash insurance not taken. BC and bank should insure the cash holding and
transit cash insurance to safeguard the interest of CSPs.
Capacity building of BCs staff:
Some training to CSPs and BCs were required. The capacity building
should be done for better and effective response. The cost of training
should be borne from Financial Inclusion Fund created with NABARD.
8.1.4. CLIENTS’ PERSPECTIVE
Clients were interviewed regarding the positive and negative aspects of BCs.
Their views are presented in the table below.
Positive Negative
1. Hassle free
banking: 90% of the clients
felt that it was much easier to
do their banking activities
through the CSP as it was
nearer to their residence and
convenient in operation.
2. Easy to
open account as KYC form
1. Confidence/Trus
t of clients on BCs: Post Office
had immense faith of clients but
other two i.e. Zero Mass and Eko
were facing problems as many chit
funds had already cheated rural
people and, therefore, they were
not able to generate trust.
2. Satisfaction
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was simplified
3. Expenditur
e in opening the accounts was
almost nil.
4. Technology
made the transaction easy and
fast.
regarding service: In case of Eko,
people, having Airtel number were
happy but others had problem in
operation.
In case of Zero Mass 3600 people
had applied for the account
opening but only 600 accounts had
been opened.
3. Problem of
remittances was felt in case of
Zero Mass.
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CHAPTER 9
CONCLUSION AND RECOMMENDATIONS
The objective of the present study was to study the spread of BCs in Bihar,
acceptance of BCs by clients, problems faced by different stake holders in
implementation of BC model and scope of BC in financial inclusion in rural
areas. The data were collected from 90 clients, seven CSPs, five banks, RBI,
NABARD and Government Department. Total number of sample size was 112.
Major findings and recommendations of the study are as under:
MAJOR FINDINGS:
Interview with BCs and clients revealed that BCs were not charging any
fees from clients. It was observed during interview that the payment to
the BCs was not being done regularly
It was seen during the interaction with BCs that they were using
technology except Post Office.
Interview with bankers revealed that the banks at state level had not
constituted the Grievance Redressal Committee as yet.
During the interview it was observed that KYC form was simplified by
the bank for BCs clients and BCs were adopting the KYC norms.
The common service points were tagged with the specific branch locally.
Transit cash insurance for BCs/CSPs was not taken by banks
A closer look of the attempts of Banks in financial inclusion revealed that
these inclusions were through no frill accounts.
It was observed that there was no transactions in almost all accounts.
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The Banks had provided only one component of financial inclusion and
had not cared for financial literacy, financial advice, credit, insurance and
remittance.
Average population per branch is very high (18,395) in Bihar as
compared to all India figure (12,470). Even in districts where the number
of rural branches was high, most of them were poorly manned and poorly
managed
RECOMMENDATIONS:
The banks may act positively on regulatory framework on two specific
points of risk mitigation by taking transit cash insurance for BCs/CSPs
and setting up of grievance redressal committee.
As yet only three banks had appointed BCs. All the banks (commercial
banks and RRB) should appoint BCs for providing banking services to
unbanked area. Bihar Government has already created a wide network of
well equipped Vasudha Kendras under its e-governance initiative of
Government of India. Three agencies were taking care of it. These were
SRE Infrastructure Finance Ltd.
In Patna, Magadh, Purnea, Munger and Tirhut commissionery.
Zoom Developers working in
Darbhanga and Bhagalpur.
SARK System Ltd. Working in
Saran and Kosi belt.
5798 Vasudha Kendras had already been opened by above three agencies
against the target of 8463.
Similarly primary agricultural cooperative societies(8463) , Milk Producing
Cooperative Society (6200) Milk booth of COMPFED(6000), Angan Badi
Kendra(80797) may be used by the banks as BCs.
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Banks must utilize these wide networks to scale up the BC model in Bihar.
Banks should simplify the procedure for appointment of BCs. Release of
fees to the BCs and simultaneously the charge should be reasonable so
that BC model should be viable.
Bank must take this initiative as one of their main business rather than
taking it as a social responsibility. Scale up the business to earn profit and
in turn make financial inclusion a reality.
Efforts must be taken by banks to cover all the major components of
financial inclusion.
Banks should make sincere effort to increase network of bank branches in
the State to implement financial inclusion in true sense.
SBI may sort out the problem with India Post to continue the account
opening process which had been stopped by India Post at present.
Cash handling issues can be solved by adopting the “MILK ROUTE”
method COMPFED adopted to collect milk from villages to district
As technology was a necessity for
scaling up the BC Model, banks can help BC to bear the initial cost on
account of introducing technology which BC can pay back after a certain
time period.
Banks may be permitted to
collect reasonable service charge from the customer for delivering
services through BC model.
Banks may bear the initial set up
cost of the BCs and extend a handholding support to the BCs, at least
during the initial stages.
Banks should utilize the fund sanctioned by NABARD for financial
inclusion for capacity building of BC and increase financial inclusion.
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It had been found that India Post was not utilizing technology for its BC
business. BCs must use technology to make the business more viable and
scalable.
BCs must take initiatives to build up confidence amongst people. It can
do so by conducting meeting/seminar with local people and make them
understand the concept of BC model.
BCs must start scaling up the business with operational effectiveness.
BCs have already identified the clients and thus can utilize this
information to make JLGs and SHGs and in turn avail the financial
support from NABARD through their bank. This will provide financial
sustainability to the system.
The Government of Bihar/banks may telecast advertisement of the BC
model and its benefits on the local Radio/TV channels which will create a
feel of confidence among the public.
Financial literacy and Credit Counseling Centers(FLCCs) may be utilized
to make the literate mass familiar with the practices of the BC to create
confidence among the general public.
NABARD should play proactive role in awareness creation, publicity,
improving financial literacy and use of technology for the financial
inclusion. At the time of study no disbursal had been made by NABARD
out of its two funds in the state of Bihar. NABARD should take
aggressive marketing of BC products.
RBI should reconsider a few guidelines for BC operations such as:
Relaxing the limitation of area
for setting up a CSP
Limitation of time of one day for
depositing the money in bank
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Within strict review and guidelines companies of offering BC services
should be allowed to work for profit rather than non-profit entity. Only
then scaling up of business can happen making financial inclusion
possible.
Presently not much feedback was available on implementation of BC as
nobody was monitoring it. Review and monitoring mechanism for the BC
model should be started in SLBC and DLCC meetings.
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ANNEXURE I
DETAILS REGARDING NUMBER OF BCs APPOINTED AND ACCOUNTS OPENED BY BANKS IN COUNTRY AS ON 31-03-2010
Sr. No. Banks No. of BCs appointed
No.of accounts opened
PUBLIC SECTOR BANKS
1 ALLAHABAD BANK NIL NIL
2 ANDHRA BANK 3 405000
3 BANK OF BARODA 3 33827
4 BANK OF INDIA 10 71000
5 BANK OF MAHARASHTRA NR NR
6 CANARA BANK 1 1603
7 CENTRAL BANK 1 1210
8 CORPN BANK 3 456655
9 DENA BANK 1 14146
10 INDIAN BANK 2 23000
11 I O B 3 1131
12 O B C 3 21433
13 P N B 14 2704345
14 P & S BANK NIL NIL
15 S B I 24 2574139
16 S B B J NIL NIL
17 S B HYD 1 16057
18 S B INDORE 1 61632
19 S B MYSORE 2 2159
20 S B PATIALA 1 1140
21 S B SAURASHTRA NIL NIL
22 S B TRAVANCORE 1 699
23 SYNDICATE BK 5 695
24 UNION BANK 3 1654464
25 UNITED BANK 1 998
26 UCO BANK 1 1048
27 VIJAYA BANK 1 626
Total 85 8047007
NR- Not Reported
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PRIVATE SECTOR BANKS
1 Bank of Rajasthan Ltd NIL NIL
2 Development Credit Bank Ltd NR NR
3 Dhanalakshmi Bank Ltd NR NR
4 The Federal Bank Ltd 2 68
5 Yes Bank Ltd NIL NIL
6 HDFC Bank Ltd NR NR
7 ICICI Bank Ltd 38 136659
8 IndusInd Bank Ltd NR NR
9 ING Vysya Bank Ltd NIL NIL
10 Jammu & Kashmir Bank Ltd NR NR
11 Karnataka Bank Ltd NIL NIL
12 Karur Vysya Bank Ltd NIL NIL
13 Kotak Mahindra Bank Ltd NR NR
14 Lakshmi Vilas Bank Ltd NIL NIL
15 Nainital Bank Ltd 1 532
16 Ratnakar Bank Ltd NR NR
17 SBI Comm. & Inter. Bank Ltd NIL NIL
18 The South Indian Bank Ltd NIL NIL
19 Tamilnad Mercantile Bank Ltd NIL NIL
20 Axwas Bank Ltd 3 676000
21 Total 44 813259
NR: Not Responded
Source : rbi.org.in
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Annexure II
Performance of Banks under 100% financial inclusions as on 31-03-2009 in
Bihar
Serial.No.
Name of
districts
Lead
Bank
No. of
Villages
allotted for
100%
financial
Inclusion
No of
villages
where
100%
financial
inclusion
completed
No. of
households
allotted for
100%
financial
inclusion
No. of
households
completed
for 100%
financial
inclusion
Status of
Financial
Inclusion
A B C D E F G H
1 PURNEA SBI 1281 1281 492491 492491 100
2 SAHARSA SBI 474 453 218134 213993 98
3 SUPAUL SBI 565 565 308453 308453 100
4 BUXAR PNB 112 162 280479 254864 90.87
5 ROHTAS PNB 1698 52 346043 296016 85.54
6 BHOJPUR PNB 1239 349 278028 222499 80.03
7 GAYA PNB 3748 2570 788820 752410 95.38
8 KATIHAR CBI 1374 1158 567416 498225 87.81
9 SIWAN CBI 1580 1243 531080 308587 87.9
10 GOPALGANJ CBI 1566 1088 425444 363208 85.37
11 MADHUBANI CBI 767 622 600000 549611 91.6
12 VAISHALI CBI 1638 1296 385923 372708 96.58
13 SARAN CBI 1813 1662 832401 774737 93.07
14 SITAMARHI BOB 845 312 723259 595375 82.32
15 SHEOHAR BOB 95 95 47214 47214 100
16 KHAGARIA UNION
BANK 329 282 255335 197612 77.39
17 SHEIKHPURA CANARA
BANK 341 341 54860 54860 100
18 MUNGER UCO 860 707 110839 105226 94.94
19 BANKA UCO 2131 1112 278639 228482 82
TOTAL 23456 15350 7344858 6636571 90.36
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BIBLIOGRAPHY
Websites referred: www.rbi.in www.microsave.org.in
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www.birdindia.com www.bihar.nic.in www.alittleworld.com www.nabard.org.in
Books/Journals referred:
NSSO survey 59th round
CMF, working paper series 2007
State of sector report 2009
Journal of CMR, BIRD Lucknow, The microFINANCE
Review/volume1 number1
Articles/Report
Ragarajan Committee Report.
Universal Financial Inclusion in India: The Way Forward.
The Maturing of Indian Microfinance, Findings of microfinance impact
assessment study (baseline) - implications for policy and practice.
Study by EDA Rural Systems, for SIDBI Foundation for Micro Credit.
State Level Banker’s Committee Report, Bihar(13.03.2010).
The Pain of Failure: Lessons from MFI Liquidations-By Daniel Rozas