1. SMARTLESSONS — MAY 2012 1
ABOUT THE AUTHOR
SACHIN BANSAL
is an Operations Officer with IFC
Access to Finance Advisory,
South Asia, since July 2011. He is
based in Delhi and has eight
years of experience in the fields
of financial inclusion, liveli-
hoods, and microfinance. Sachin
has direct implementation expe-
rience along with financial sec-
tor consulting.
APPROVING MANAGER
Jennifer Isern, Manager, Regional
Business Line Leader, Access to
Finance Advisory, South Asia.
Acknowledgement:
We are grateful to the FINO
team, especially Knowledge
Editor Jatinder Handoo, for
their support in providing data
used in this SmartLesson.
Doorstep Banking:
Grooming Last-Mile Bankers in India
An IFC-supported branchless banking technology and delivery company
taps local human resources to build a network of 27,000 transaction points,
serving more than 46 million customers in 414 district, across 27 states in
India. Let us see how it successfully manages to leverage the local talent to
handle complex banking transactions effectively and makes this very low-
margin business profitable.
Background
Founded in July 2006 and headquartered in
Mumbai, India, FINO (www.fino.co.in) has
pioneered the bank-led model of branchless
banking across India. FINO is not a bank; it is a
technology and operations provider that acts
as a conduit between financial services
providers and their customers. In a short span
of time, the company has begun to play a vital
role in bringing financial inclusion to the
financially underserved population in India.
Acting as a business correspondent for various
banks, FINO is a market leader in enabling
these institutions to source and service low-
value transaction customers and deliver
financial services (savings, credit, remittance,
insurance) to customers’ doorsteps.
According to a study released by CGAP
(Consultative Group to Assist the Poor) in
2010, FINO is the world’s largest banking
agent manager.1
Recognition of FINO’s work
includes the Financial Times award and Asia
Insurance Review award, among others, as
well as acknowledgement on such national
and international platforms as the World
Economic Forum.
FINO serves more than 46 million customers
through 27,000 transaction points across 27
states in India. Although typically recognized
for its contribution to financial inclusion, FINO
in its journey has also contributed significantly
to employment, creating opportunities for
more than 27,000 previously unemployed and
underemployed women and men who now
deliver financial services to FINO’s end
1
Karuna Krishnaswamy, Claudia McKay, Mark Pickens,
Sarah Rotman (April 2010), “Building Viable Agent Net-
works in India,” CGAP.
customers. These last-mile bankers, 39 percent
of whom are women, are employed by FINO
locally and are known as bandhus (friends) or
agents.
FINO’s bandhus are a critical link between
formal financial institutions (such as banks
and insurance companies) and the masses of
people in urban and rural areas who lack
access to financial services. The quality and
commitment of the bandhus are key to
achieving the institutions’ financial inclusion
goals. Realizing this critical importance of
bandhus in the financial inclusion process,
FINO pays careful attention to their
recruitment, induction, and management.
IFC provides an integrated and coordinated
package of investment and advisory support
to FINO to support its expansion plans while
significantly promoting financial inclusion for
low-income people in India. This SmartLesson
summarizes the lessons learned in the process
of creating jobs for these last-mile bankers—
and may serve as a guide for other similar
initiatives.
Lessons Learned
Lesson 1: Hire local talent for bridging the
last mile.
FINO recruits local personnel for ensuring the
last-mile link with the customer. This is an
important factor in the success of FINO’s
business, because local people understand the
geography and financial behavior of the local
population very well. Hiring local talent is also
MAY 2012

2. 2 SMARTLESSONS — MAY 2012
less expensive for the company than hiring from outside,
which can entail relocation costs, higher salary expectations,
and other associated expenses. To hire locally, FINO
leverages local mass media to raise awareness of job
vacancies in nearby villages and areas.
FINO takes adequate measures to verify the social standing
of an applicant through various informal and formal
verifications with such local community actors as the
sarpanch (village head), school teacher, government
officials, and police.
Lesson2:Toavoidbiases,communicatejobrequirements
effectively and quantify candidate selection criteria.
FINO has developed a recruitment tool to judge the
suitability of applicants for the job. The tool is designed to
rate a candidate on several critical parameters (see Table 1)
and calculates a weighted average score. This approach
helps overcome any biases in the selection process, because
the indicators are known to everybody and final scores can
be easily verified.
The tool design is based on FINO’s experience working with
bandhusoveraperiodoftimeandrecognizingarelationship
between the parameters and a bandhu’s success in the
field. This tool not only ensures fair selection but also helps
establish process standardization across the organization.
Lesson 3: Provide effective training and onboarding
support.
AtFINO,aspecialteam—knownastheChannelEmpowerment
and Management team—is in charge of inducting new
bandhus. A rigorous induction is a prerequisite for all
bandhus before starting the job. The induction process is a
mix of classroom and on-the-job exposure. This combination
of theory and practice enables applicants to decide whether
they are interested in such a job, which requires intense field
work and interaction with customers.
This process in turn builds the confidence of both FINO and
the applicant. After selection, bandhus are once again
offeredclassroomtrainingatthezonallevel.Thecomponents
of bandhu training involve:
Soft skills
Customer service
Basic banking
Point of Transaction (PoT) machine handling
Technical troubleshooting
Cash management, and so on
After three days of training, FINO conducts an internal test,
and only those candidates who pass the examination are
given a certificate of induction and then deployed in the
field. This rigorous training ensures that only capable and
willing candidates are selected for the job.
Lesson 4: Ensure that there are enough incentives for the
agents to maintain their motivation to work and deliver
quality.
Once the bandhu is on the job, it is FINO’s responsibility to
support her or him to generate enough business to make
sufficient commissions to stay motivated. FINO pays the
bandhus a fixed salary in addition to a commission for
every account opening and transaction, to ensure a
minimum level of salary. (See Figure 1.)
Sixty percent of FINO’s agents are mobile and visit
customers at their doorstep. The other 40 percent operate
from their establishments, and people come there to
make transactions in their bank accounts. FINO manages
its bandhu density in an area in a way that makes sure
every bandhu has the potential to earn enough money.
On average, each bandhu caters to about 1,000 customers
in an area of two or three villages.
Training of bandhus by FINO staff. (Photo by Sachin Bansal)
Table 1: Selection Parameters for Recruitment of Bandhus
Parameters Weights
(%)
Tenure of stay in that area 10
Familiarity with local geography 15
Knowledge of vernacular language/culture 17
Knowledge of English 7
Familiarity with local people 17
Previous experience 6
Level of education 8
Knowledge of using computer/mobile 10
Softskills(communicationskills,personality) 10
Source: FINO

3. SMARTLESSONS — MAY 2012 3
In addition, FINO offers a complete suite of products
(savings, credit, insurance, remittance) to meet the
financial needs of people without access to banks. A
multiple-product suite offering enhances a bandhu’s
chances of increasing the number of transactions per
customer, and thereby achieving higher earnings.2
Along with the financial services, FINO has developed a
delivery platform for a unique assortment of value-added
e-services to its customers. These doorstep services,
offered through partnerships with different service
providers, make available yet another avenue for
commissions for bandhus. They include:
Mobile recharge
DTH (direct-to-home television) recharge
Railway ticket booking and bus booking
Insurance premium collection
Payment of utility bills (mobile and electricity), municipal
taxes, and so on
Mobile SIM (subscriber identity module) card selling
2
Prakash Lal (February 15, 2011), “Boosting the Business Case for Agents,”
CGAP Technology Blog.
Lesson 5: Invest in building financial literacy, and product
awareness.
After reaching a certain scale, FINO realized the importance
of financial literacy and product awareness. As a result, it
has invested a considerable amount in designing and
delivering financial literacy tools. Bandhus are trained to use
these tools, and then they train the end customers. Results
from this training are very encouraging, because the clients
receiving such training use the services more often.
More important, this training encourages a routine saving
habit and ensures regular transactions and therefore more
commissions for the bandhu. FINO is engaging in various
financial literacy projects in partnership with the World
Bank, IFC, Microfinance Opportunities, United Nations
Development Program, and National Bank for Agriculture
and Rural Development.
Lesson 6: For enhanced performance, provide effective
monitoring and regular field support.
FINO hired “block coordinators,” each of whom manages
approximately 10–15 bandhus in the field. A block
coordinator typically visits each of the bandhus every other
day to collect excess cash or deliver new cash, thus enabling
bandhus to provide uninterrupted service to their clients.
Block coordinators also provide a range of hand-holding
support activities to the bandhus, such as during a
technology glitch, and they help them resolve any other
problems they face in conducting their business. This
regular monitoring and support system ensures smooth
functioning of bandhus.
FINO has several field-force monitoring mechanisms in
place. But the most useful one is an online SMS3
-based
monitoring system called “Samvaad” (see Figure 2).
Monitored by a dedicated team located at the head office,
the system is updated on an online live dashboard showing
the real-time status of FINO’s entire bandhu workforce.
3
SMS = short message system.
Figure 2: Field-Force Monitoring Tool Used by FINO
Source: FINO
FINO’s Financial Literacy Campaign poster.
(Photo by Sachin Bansal)
Figure 1: Profit Calculation for a Bandhu
Source: CGAP Technology Blog.

4. 4 SMARTLESSONS — MAY 2012
Conclusion
Irrespective of theme, sector, or objectives,
most development initiatives have the
potential to create jobs, especially at the
bottom of the pyramid, by the complementary
use of local resources and technology. Local
people, if recruited and trained effectively,
and using the right media, can deliver high-
quality services at a low cost. Success depends
on the robustness of systems and the quality
of institutional support lent to the people.
The FINO experience shows that, with the
right combination of resources, innovation,
and implementation, such an initiative can
deliver strong development impact right at
the doorstep!
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services and investment opera-
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