The document discusses common financial inclusion programs in rural India. It begins by providing an overview of the rural landscape, including the number of districts by state. It then discusses the existing rural footprint of banks like regional rural banks and lead banks in districts. The scope section outlines the goals of creating scalable business models, tailored solutions, and collaboration between stakeholders to revitalize rural areas. It proposes hub and spoke models and disentangaging technology from distribution to strengthen last mile access. The need for a strong technology backbone and reliable last mile distribution is also highlighted.

1. COMMON FINANCIAL INCLUSION
PROGRAM

2. CONTENTS
 Rural landscape
 Rural footprint of banks
 Scope of inclusive banking programme
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3. RURAL LANDSCAPE – TOTAL NO. OF DISTRICTS(600)
# State Dist. # State Dist.
1 Andhra Pradesh 23 15 Maharashtra 35
2 Arunachal Pradesh 14 16 Manipur 9
3 Assam 23 17 Meghalaya 7
4 Bihar 37 18 Mizoram 8
5 Chhattisgarh 16 19 Nagaland 8
6 Goa 2 20 Orissa 30
7 Gujarat 25 21 Punjab 17
8 Haryana 19 22 Rajasthan 32
9 Himachal Pradesh 12 23 Sikkim 4
10 Jammu and Kashmir 14 24 Tamil Nadu 29
11 Jharkhand 22 25 Tripura 4
12 Karnataka 27 26 Uttarakhand 13
13 Kerala 14 27 Uttar Pradesh 70
14 Madhya Pradesh 48 28 West Bengal 19
# UT Dist. # UT Dist.
A Andaman and Nicobar Islands 2 E Lakshadweep 1
B Chandigarh 1 F Pondicherry 4
C Dadra and Nagar Haveli 1 G Delhi 9
D Daman and Diu 1
Source: 3
http://en.wikipedia.org/wiki/List_of_Indian_districts

4. RURAL LANDSCAPE – INFRASTRUCTURE CROSS-
SECTION
Able – 160 (17%)
Deprived – 248 (50%)
Urban cousins – Rural economic
67 (10%) Centres – 118
(23%)
4
Majority of the population resides in areas with minimal infra. and accessibility
Fig. in brackets are % of Source: Bharat Nirman Plus:
rural pop. Report by Mckinsey for CII

5. FOOTPRINT @ RURAL LEVEL
 No. of sponsored Regional Rural Banks (RRBs) – 177 *
 These banks have a large rural presence incl. remote areas
 Their governance is largely influenced by the sponsoring PSBs
 Many of these have some level computerisation
 Lead banks in districts
 Traditionally PSBs have been lead banks in most districts in India
 They are the channelising agency for development in those districts
 This is a non-competitive arrangement between banks with a social banking objective
 Rural branches of commercial banks
 Total no. of rural branches 30754 (estimate)
 Total no. of villages in India 6,38,365 (2001 census)
 These are brick & mortar branches which have the potential of technology investment
 Post Offices
 Over 1.5 lacs post offices in India of which ~ 1.3 lacs in villages
 Other distribution entities
 Local merchants, telco agents > 6 lacs
 Common Service centres ~ 1 lac
 Insurance agents, dairies etc. 5
Substantial rural footprint is currently available for leveraging as hubs
* Source : The Performance of Regional Rural Banks (RRBs) in India:Has Past
Anything to Suggest for Future?

6. SCOPE OF THE INCLUSIVE BANKING PROGRAM
Creating successful business delivery models which can be replicated
in view of the diversity of rural India
Creating tailored solutions to ensure effectiveness and
sustainability of the initiative
Ensuring a concerted effort by all key stakeholders
to rejuvenate rural India
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7. Creating successful business delivery models which can be replicated in view of the diversity of rural India
BUSINESS DELIVERY MODELS
 Inter - Bank collaboration
 Standardising the product suite, service pack on offer
 Standardising business processes, risks
 Standardising enrollment of 3rd party agencies/ service
providers
 Non-competitive areas of concentration say based on lead
districts, RRB presence etc.
 Complimentary shared services in the areas of
 Field force training
 Support network at the field level
 Joint negotiation with vendors
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Banks become nodal agencies for rural initiatives and leverage existing setups

8. Creating tailored solutions to ensure effectiveness and sustainability of the initiative
IMPLEMENTATION APPROACH – HUB & SPOKE MODEL
Txn Delivery District Category Solution
model Characteristics
Urban/
CBS + internet kiosks +
Branch staff Urban
POS online (Slums)
Cousins
Rural
RRBs + lead bank rural
economic CBS + internet kiosks +
branches
centres POS online
RRB’s as nodal branches + CBS for nodal branches +
3rd party merchants etc. Able POS
Robust & Scalable Architecture
RRB’s as nodal branches + CBS for nodal branches +
3rd party merchants etc. Deprived
POS
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Customised solution models for a standard implementation approach

9. Ensuring a concerted effort by all key stakeholders to rejuvenate rural India
COMMON FINANCIAL INCLUSION
 Inter – industry collaboration
 Collaboration with insurance companies for addressing insurance
requirements
 Collaboration with NGO’s/SHG’s
 Collaboration with companies engaged in rural development like power,
telecom, road, fertilizer etc.
 Collaboration with educational institutions for rural vocational education
 Bank – Govt. collaboration
 Channelising agencies for NREGA funds, subsidies etc.
 Channelising agencies for Bharat Nirman funds
 Subsidies/schemes for infrastructure development at the local level say
 Alternate power e.g. biomass, wind
 Rain-water harvesting for water
 Roads
 Subject Matter Expert’s (SME’s) to accompany service provider for technical
assistance
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Collaborative effort in ensuring funding – channelising - operationalising

10. Ensuring a concerted effort by all key stakeholders to rejuvenate rural India
DISENGAGING TECHNOLOGY & DISTRIBUTION
Local Merchant Dairies,
Insurance Customer
Co-op Banks / agents Self-
PACS /RRB etc. service
All bank branches
Common Service Centers,
Post Offices
PC / Kiosk / POS / Mobile….
Authentication System Centralised Gateway Credit Information Bureau
e.g. AADHAR (ala Visa/Mastercard e.g. CIBIL
for cards)
- 10 -
Back end systems e.g. bank, insurance, government etc.

11. Ensuring a concerted effort by all key stakeholders to rejuvenate rural India
CREATING A STRONG TECHNOLOGY BACK BONE
 Backbone - Messaging Super-Highway to
form the central message carrier &
distribution grid
 Empanelling last mile technology
 Inter-operable technologies
 Standards driven approach
 Compatibility with central messaging backbone
 Common maintenance, repair & helpdesk at the
local level
 Leverage existing settlement systems

12. Ensuring a concerted effort by all key stakeholders to rejuvenate rural India
STRENGTHENING LAST MILE DISTRIBUTION
Community
involvement
Favorable
Shared Shared Trust
Cost-
Training Support
benefit
Reliable
services

13. Ensuring a concerted effort by all key stakeholders to rejuvenate rural India
STATE OF AFFAIRS
 Confused customer – multiple cards, multiple touch
points, local money lender still scores on reliability of
service
 Banks / insurance companies – no business case, no
real integration with the normal banking systems,
limited banking products made available to the
customer
 Govt. – steam-rolling AADHAR as the panacea without
adequate on-ground experience/civil society involvement
to support, multiple ministries/departments singing
their own tunes, treating rural India as one homogenous
segment to woe with doles

14. THANK YOU