ICT IN FINANCIAL INCLUSION  e- World Forum  DATED 3 AUG. 2011
FINANCIAL INCLUSION LANDSCAPE <ul><li>CURRENT SCENARIO </li></ul><ul><li>More than  40%  of  population in the country is ...
Reasons for exclusion  <ul><li>There are a variety of reasons for financial exclusion:-  </li></ul><ul><li>Physical access...
FINANCIAL INCLUSION <ul><li>Three  ‘Mission Critical’  Ingredients: </li></ul><ul><ul><li>Technology </li></ul></ul><ul><u...
TECHNOLOGY:  APPROACH <ul><li>Target: Financial Inclusion (FI); Technology as an enabler. </li></ul><ul><li>Technologies: ...
TECHNOLOGY  PLATFORMS FOR FINANCIAL INCLUSION
PROCESS FLOW FOR CARD AND POS BASED TRANSACTIONS   CASH DATA POS DEVICE BC WIRELESS -  GPRS CLOUD ONLINE SBI’s GATEWAY LEA...
TECHNOLOGY  PLATFORMS FOR FINANCIAL INCLUSION
PROCESS : PC- KIOSK INTERNET BASED CASH DATA FINGER PRINT VALIDATION Internet BC PC INTERNET KIOSK STATE BANK OF INDIA KIO...
TECHNOLOGY  PLATFORMS FOR FINANCIAL INCLUSION
CASH DATA CELL PHONE BC WIRELESS – USSD MESSAGING  SBI CORE BANKING SBI gateway PROCESS : MOBILE BASED CUSTOMER WITH OWN C...
TECHNOLOGY CHANNEL WISE PROGRESS Number in Lakh; Rupees in Crores
<ul><ul><li>Modes of Operation </li></ul></ul><ul><ul><ul><li>Offline (Batch Posting) and Online </li></ul></ul></ul><ul><...
THANK YOU STATE BANK OF INDIA
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L P Rai

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Presentation given by L P Rai, Deputy General Manager, State Bank of India on August 3rd, 2011 at eWorld Forum (www.eworldforum.net) in the session ICT in Financial Inclusion, Taxation, Excise and Finance

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L P Rai

  1. 1. ICT IN FINANCIAL INCLUSION e- World Forum DATED 3 AUG. 2011
  2. 2. FINANCIAL INCLUSION LANDSCAPE <ul><li>CURRENT SCENARIO </li></ul><ul><li>More than 40% of population in the country is unbanked </li></ul><ul><li>More than 51% of farm households have no access to formal or informal sources of credit while 73% have no access to formal sources of credit </li></ul><ul><li>The financially excluded sections largely comprise:- </li></ul><ul><ul><li>Marginal farmers, landless labourers, </li></ul></ul><ul><ul><li>Self employed and unorganised sector enterprises, </li></ul></ul><ul><ul><li>Urban slum dwellers, migrants, ethnic minorities and socially excluded groups, senior citizens and women. </li></ul></ul><ul><ul><li>While there are pockets of large excluded population in all parts of the country, the North East, Eastern and Central regions contain most of the financially excluded population. </li></ul></ul>
  3. 3. Reasons for exclusion <ul><li>There are a variety of reasons for financial exclusion:- </li></ul><ul><li>Physical access as a deterrent in remote, hilly and sparsely populated areas with poor infrastructure, </li></ul><ul><li>Lack of awareness, low incomes/assets, social exclusion, illiteracy act as barriers. </li></ul><ul><li>Distance from branch, branch timings, cumbersome documentation and procedures, unsuitable products, language, staff attitudes are common reasons for exclusion . </li></ul><ul><li>higher transaction cost apart from procedural hassles. </li></ul><ul><li>the ease of availability of informal credit sources makes these popular even if costlier </li></ul><ul><li>Stringent KYC requirements </li></ul><ul><li>Inability to prove identity is one of the biggest barriers preventing the poor from accessing banking services /benefits and subsidies. </li></ul><ul><li>Existence of fake/ghost non verifiable identities </li></ul>
  4. 4. FINANCIAL INCLUSION <ul><li>Three ‘Mission Critical’ Ingredients: </li></ul><ul><ul><li>Technology </li></ul></ul><ul><ul><li>Economic viability </li></ul></ul><ul><ul><li>The BC network </li></ul></ul>STATE BANK OF INDIA
  5. 5. TECHNOLOGY: APPROACH <ul><li>Target: Financial Inclusion (FI); Technology as an enabler. </li></ul><ul><li>Technologies: multiple and evolving; many small providers, scalability challenge </li></ul><ul><li>Determinants of technology selection : </li></ul><ul><ul><li>Business Correspondent (BC)’s - cost, ease of use and support. </li></ul></ul><ul><ul><li>Bank’s/Customer’s– cost per customer enablement </li></ul></ul><ul><li>Approach–Initially pilot and expand thru learning in multiple technologies and partnerships. </li></ul>STATE BANK OF INDIA
  6. 6. TECHNOLOGY PLATFORMS FOR FINANCIAL INCLUSION
  7. 7. PROCESS FLOW FOR CARD AND POS BASED TRANSACTIONS CASH DATA POS DEVICE BC WIRELESS - GPRS CLOUD ONLINE SBI’s GATEWAY LEASED LINE / ISDN OFFLINE - DAY END UPLOAD STATE BANK OF INDIA Tech vendor BACKEND RBG SWITCH SBI BRANCHES SBI BRANCHES SBI BRANCHES SBI CORE BANKING
  8. 8. TECHNOLOGY PLATFORMS FOR FINANCIAL INCLUSION
  9. 9. PROCESS : PC- KIOSK INTERNET BASED CASH DATA FINGER PRINT VALIDATION Internet BC PC INTERNET KIOSK STATE BANK OF INDIA KIOSK BANKING SERVER (Chennai) SBI BRANCHES SBI BRANCHES SBI BRANCHES SBI CORE BANKING
  10. 10. TECHNOLOGY PLATFORMS FOR FINANCIAL INCLUSION
  11. 11. CASH DATA CELL PHONE BC WIRELESS – USSD MESSAGING SBI CORE BANKING SBI gateway PROCESS : MOBILE BASED CUSTOMER WITH OWN CELLPHONE STATE BANK OF INDIA SBI BRANCHES SBI BRANCHES SBI BRANCHES Application Host- Vendor’s 3 Level security check: Mobile number, Booklet & Security PIN
  12. 12. TECHNOLOGY CHANNEL WISE PROGRESS Number in Lakh; Rupees in Crores
  13. 13. <ul><ul><li>Modes of Operation </li></ul></ul><ul><ul><ul><li>Offline (Batch Posting) and Online </li></ul></ul></ul><ul><ul><ul><li>Core Backend services and support functions include – </li></ul></ul></ul><ul><ul><ul><li>Interface between different tech vendors with switch and CBS </li></ul></ul></ul><ul><ul><ul><li>Daily settlement of accounts with vendors </li></ul></ul></ul><ul><ul><ul><li>Monitoring /Reporting failed/successful transactions/Reconciliations </li></ul></ul></ul><ul><ul><ul><li>Data file transfer to technology vendor – SFTP </li></ul></ul></ul><ul><ul><ul><li>Daily transaction settlement , latest balance transmission to monitor Backend of vendor for front end synchronization </li></ul></ul></ul><ul><ul><ul><li>Lease line connectivity from Tech vendor to Banks server to receive the transactions originating from field /front end devices </li></ul></ul></ul><ul><ul><ul><li>Security through firewall placed in between </li></ul></ul></ul><ul><ul><ul><li>SFTP for transfer of data and receipt of files for further processing </li></ul></ul></ul>BACKEND SERVICES
  14. 14. THANK YOU STATE BANK OF INDIA

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