Financial inclusion Role of Technology

1. TECHNOLOGY FOR FINANCIAL INCLUSION

2. TECHNOLOGY FOR FINANCIAL INCLUSION
Why do we need to talk about it
 Extremely large target population
Current Banking systems service merely 33% of total
population
 Customer profile different
Very low Literacy levels and Awareness
 Business Processes need re-engineering
Existing processes can not produce desired results
 Independent Delivery Agencies
Deployment of Business Correspondents/ Facilitators
 Latest trends in Technology
Cost-effective state-of-the-art technologies are
available today

3. TECHNOLOGY FOR FINANCIAL INCLUSION
Profile of Financial Inclusion Technology
 Capture Customer details and facilitate Unique
Identification
 Provide non-repudiable and user-friendly authentication
mechanism
 Ensure reliable connectivity upto the last mile
 Offer Financial products tailored for the target group
 Support comprehensive Credit Information System
 Support use of multimedia and innovative User Interfaces
 Work in rural environmental conditions
 Low Capital and Maintenance costs

4. TECHNOLOGY FOR FINANCIAL INCLUSION
Financial Inclusion Processes
 CUSTOMER ACQUISITION
Identification
Enrolment
Account Opening
 BANKING TRANSACTIONS
Cash Deposit
Cash Withdrawal
Government Benefits/ Payments
Transfers
Remittances
Micro Finance
 NON-BANKING TRANSACTIONS
Micro Insurance
Investments
Value-added Services

5. TECHNOLOGY FOR FINANCIAL INCLUSION
Card Based Identification
 Why Cards?
 Choice of Cards
Magstripe Card
Contact Smart Card
Contactless Smart Card
Plain PVC Card
Plain Laminated Card

6. TECHNOLOGY FOR FINANCIAL INCLUSION
Card Based Identification
MAGSTRIPE CARD
Data laid out on a magnetic strip at the back of the
card in three tracks. A magnetic stripe card may have
any of these tracks, or a combination of these tracks.
Track 3 is used for financial transactions. ISO Standards
are used for encoding the data in the tracks.
Approximate Cost Rs10 - Rs15

7. TECHNOLOGY FOR FINANCIAL INCLUSION
Card Based Identification
CONTACT SMART CARD
Smart Cards have embedded microprocessor in a
contact area, comprising several gold-plated contact
pads, which can store and process data. They can
receive input which is processed — by way of the ICC
applications — and delivered as an output.
Capacity: 8K – 64K
Approximate Cost Rs75 - Rs120

8. TECHNOLOGY FOR FINANCIAL INCLUSION
Card Based Identification
CONTACTLESS SMART CARD
The chip communicates with the Card Reader through
RFID (Radio Frequency Identification) induction
technology. These cards contain an Antenna but not
gold-plated contacts and require close proximity to the
Reader to complete transactions.
Capacity 1K - 4K
Approximate Cost Rs125 - Rs200

9. TECHNOLOGY FOR FINANCIAL INCLUSION
Card Based Identification
PLAIN PVC CARD
PLAIN LAMINATED CARD
Plain Cards which can carry Customer Information, a
photograph, hologram and a barcode if necessary
Approximate Cost Rs2 – Rs10

10. TECHNOLOGY FOR FINANCIAL INCLUSION
Authentication
 USER/ CUSTOMER AUTHENTICATION
 WRITTEN AUTHORIZATION
Signature/ Thumb impression
 PIN BASED AUTHORIZATION
What you have - What you know
 BIOMETRIC AUTHORIZATION
Fingerprint/ Iris/ Voiceprint

11. TECHNOLOGY FOR FINANCIAL INCLUSION
THE RIGHT CHOICE
 OPERATIONAL CONSIDERATIONS
 COST CONSIDERATIONS
 REGULATORY CONSIDERATIONS
USE SMART CARDS OR CARDS SMARTLY?

12. TECHNOLOGY FOR FINANCIAL INCLUSION
CONNECTIVITY ISSUES
 OFF-LINE/ ON-LINE/ REALTIME
 INTEGRATION WITH BANK SYSTEMS
 INTERNET/ V-SAT/ MOBILE COMMUNICATION
 LAST MILE CONNECTIVITY - GROUND REALITIES

13. TECHNOLOGY FOR FINANCIAL INCLUSION
HANDHELD DEVICES
A simple Handheld device

14. TECHNOLOGY FOR FINANCIAL INCLUSION
HANDHELD DEVICES
A Handheld device with Value-added Services

15. TECHNOLOGY FOR FINANCIAL INCLUSION
INNOVATIONS
 MOBILE TECHNOLOGY
 2-D BARCODES
 BIOMETRIC LOW COST ATM
 SUPPLY CHAIN SYSTEMS

16. TECHNOLOGY FOR FINANCIAL INCLUSION
LOW-COST ATM

17. TECHNOLOGY FOR FINANCIAL INCLUSION
A Typical Architecture

18. TECHNOLOGY FOR FINANCIAL INCLUSION
QUESTIONS