This document is a report from an expert committee on harnessing the India Post network for financial inclusion. It provides recommendations for India Post to expand its role in delivering universal access to core financial services of savings accounts, payments, and credit. Specifically, it recommends that India Post leverage its vast network of 155,000 branches to (1) open savings accounts for more Indians, (2) develop an electronic payments network, and (3) provide microloans to underserved communities through a proposed mechanism. The report finds that India Post is well-positioned due to its experience in savings accounts and money transfers, and that fulfilling this expanded financial inclusion role can help address both policy goals and India Post's strategic needs.
this is a kind of research paper on financial inclusion and e-banking services awareness among the customer of State Bank of India with special reference to customer of Agra...
the sample size of study is small because of limited time periiod...
This document provides details about Ketan Gyanchandani's summer internship project at AXIS Bank. It includes the project guide names from AXIS Bank, Ketan's faculty mentor from his university, and declarations about the project. The project aims to study the nuances and workings of retail banking. It discusses AXIS Bank's products, account opening procedures, risk management practices, and recently launched government schemes like Pradhan Mantri Suraksha Bima Yojana and Pradhan Mantri Jeevan Jyoti Bima Yojana.
A STUDY ON DEPLOYMENT OF ATMs OF COMMERCIAL BANKS IN INDIARAVICHANDIRANG
India is one of the well organised banking system consist country in the world with effective regulated authorities and connected with more than 80 crore people. The Indian banking system comprises of 12 public sector banks, 22 private sector banks, 46 foreign banks, 56 regional rural banks, 1485 urban cooperative banks and 96,000 rural cooperative banks in addition to cooperative credit institutions As of November 2020, the total number of ATMs in India increased to 209,282. Even now this number has increased due to changing purchase behaviour of the people in the country. Indian banking industry has recently observed the roll out of innovative banking models like payments and small finance banks. RBI’s new measures may go a long way in helping the restructuring of the domestic banking industry. With the help of information and communication technology, digital banking becomes a powerful part in the financial services and products. The digital payments system in India has progressed the most among 25 countries with India’s Immediate Payment Service being the only system at level five in the Faster Payments Innovation Index.In this aspect this study made an attempt to understand the deployment of ATMs of commercial banks in India.
The document provides an overview of Axis Bank, including its history, services offered, branch network, and computing resources. It discusses Axis Bank implementing a new derivatives system called Summit FT to structure derivative products in real time and give customers a single view of transactions. The bank also selected Pyxis Systems' RisKompass software to manage financial derivatives risk from the front to back office.
Axis Bank is one of India's largest private sector banks established in 1994. It has over 1,900 branches across India and overseas in Singapore, Hong Kong, Shanghai, and Dubai. Axis Bank offers a wide range of banking products including consumer banking, corporate banking, investment banking, wealth management, and insurance. It has over 40,000 employees and total assets of over $54 billion as of 2012. Axis Bank aims to provide best-in-class and technology enabled banking services to both retail and corporate customers.
The presentation was prepared on the topic State bank of India. It is the largest bank in our country and It was established in 1921 with the name Imperial Bank of India which was later changed to State Bank of India in 1955 under a separate SBI act. #State Bank of India
Avinash sharma final project axis bank-2015Avinash Sharma
This document provides an overview of Axis Bank, one of India's largest private sector banks. It discusses Axis Bank's origins from UTI Bank in 1994, its prominent shareholders and subsidiaries. The summary also outlines Axis Bank's business activities, distribution network of over 2,300 branches across India, and status as one of the most profitable banking franchises in the country.
A Research Study on Consumer Satisfaction of Private Banking SectorMinaxi Gosai
The document is a research study report on consumer satisfaction with private banking in India. It includes a literature review on the importance and objectives of the study. It then outlines the research methodology used which was a survey method with 100 questionnaires. The findings section shows that most consumers have bank accounts, prefer private banks like HDFC, ICICI and Axis, are satisfied with services, many use online banking and feel it provides benefits. Overall consumers have high trust in their bank and would recommend it to others.
this is a kind of research paper on financial inclusion and e-banking services awareness among the customer of State Bank of India with special reference to customer of Agra...
the sample size of study is small because of limited time periiod...
This document provides details about Ketan Gyanchandani's summer internship project at AXIS Bank. It includes the project guide names from AXIS Bank, Ketan's faculty mentor from his university, and declarations about the project. The project aims to study the nuances and workings of retail banking. It discusses AXIS Bank's products, account opening procedures, risk management practices, and recently launched government schemes like Pradhan Mantri Suraksha Bima Yojana and Pradhan Mantri Jeevan Jyoti Bima Yojana.
A STUDY ON DEPLOYMENT OF ATMs OF COMMERCIAL BANKS IN INDIARAVICHANDIRANG
India is one of the well organised banking system consist country in the world with effective regulated authorities and connected with more than 80 crore people. The Indian banking system comprises of 12 public sector banks, 22 private sector banks, 46 foreign banks, 56 regional rural banks, 1485 urban cooperative banks and 96,000 rural cooperative banks in addition to cooperative credit institutions As of November 2020, the total number of ATMs in India increased to 209,282. Even now this number has increased due to changing purchase behaviour of the people in the country. Indian banking industry has recently observed the roll out of innovative banking models like payments and small finance banks. RBI’s new measures may go a long way in helping the restructuring of the domestic banking industry. With the help of information and communication technology, digital banking becomes a powerful part in the financial services and products. The digital payments system in India has progressed the most among 25 countries with India’s Immediate Payment Service being the only system at level five in the Faster Payments Innovation Index.In this aspect this study made an attempt to understand the deployment of ATMs of commercial banks in India.
The document provides an overview of Axis Bank, including its history, services offered, branch network, and computing resources. It discusses Axis Bank implementing a new derivatives system called Summit FT to structure derivative products in real time and give customers a single view of transactions. The bank also selected Pyxis Systems' RisKompass software to manage financial derivatives risk from the front to back office.
Axis Bank is one of India's largest private sector banks established in 1994. It has over 1,900 branches across India and overseas in Singapore, Hong Kong, Shanghai, and Dubai. Axis Bank offers a wide range of banking products including consumer banking, corporate banking, investment banking, wealth management, and insurance. It has over 40,000 employees and total assets of over $54 billion as of 2012. Axis Bank aims to provide best-in-class and technology enabled banking services to both retail and corporate customers.
The presentation was prepared on the topic State bank of India. It is the largest bank in our country and It was established in 1921 with the name Imperial Bank of India which was later changed to State Bank of India in 1955 under a separate SBI act. #State Bank of India
Avinash sharma final project axis bank-2015Avinash Sharma
This document provides an overview of Axis Bank, one of India's largest private sector banks. It discusses Axis Bank's origins from UTI Bank in 1994, its prominent shareholders and subsidiaries. The summary also outlines Axis Bank's business activities, distribution network of over 2,300 branches across India, and status as one of the most profitable banking franchises in the country.
A Research Study on Consumer Satisfaction of Private Banking SectorMinaxi Gosai
The document is a research study report on consumer satisfaction with private banking in India. It includes a literature review on the importance and objectives of the study. It then outlines the research methodology used which was a survey method with 100 questionnaires. The findings section shows that most consumers have bank accounts, prefer private banks like HDFC, ICICI and Axis, are satisfied with services, many use online banking and feel it provides benefits. Overall consumers have high trust in their bank and would recommend it to others.
The document discusses financial inclusion in India and the business correspondent model. It notes that while financial inclusion has received more attention, reaching all of India's population remains a challenge given limited bank branch infrastructure. The business correspondent model, using information and communication technologies like mobile phones, shows promise in expanding access in a more cost-effective way. Recent deregulation and policies are helping proliferation of this branchless banking model, but issues around interoperability, infrastructure, and incentives still need addressing as the field expands further.
Axis Bank rebranded itself from UTI Bank in 2007 for three main reasons: they had to give up the UTI name after 13 years of using it as they were not willing to accept terms from UTI AMC, including paying royalty fees; the recommendation to change the name came from brand confusion generated by other unrelated entities using the UTI brand; and the name UTI Bank implied it was a government bank so they wanted their own unique brand identity. The bank spent around Rs. 50 crore on the rebranding exercise, hiring advertising firm Ogilvy & Mather to design and implement the new Axis Bank brand, including a new logo depicting a strong growth path supported by a strong base.
An Infrastructure Development Of Airtel Payment BankSushmitaGour2
The document appears to be an internship report submitted by a student named Sushmita Gour detailing her 60 day internship with Airtel Payments Bank in Bhopal, India where she helped onboard new merchants and activate existing merchants while learning about the company's operations, strategies, and banking services. The report includes an introduction to Airtel Payments Bank, descriptions of the organization structure and departments, a review of the company's objectives and values, and a weekly overview of the internship activities performed.
This document provides an overview of Axis Bank, including:
- Axis Bank was established in 1994 as the first private sector bank after reforms allowed private banks. It was jointly promoted by UTI, LIC, and other insurers.
- Axis Bank is now the third largest private sector bank in India with over 1,700 branches across the country.
- The document outlines Axis Bank's business activities, subsidiaries, promoters including UTI and LIC, and its position as one of the leading banking franchises in India.
This document summarizes issues and developments in the microfinance sector in India. It discusses the evolution of microfinance from credit cooperative movements to the commercialization of microfinance institutions (MFIs). It highlights key issues like multiple borrowing, lack of regulation, and the 2010 Andhra Pradesh crisis. The document recommends increased use of microfinance rating agencies and technology to improve the sector. Rating agencies can evaluate MFIs' financial and social performance, while technology can make operations more efficient and enable MFIs to reach more customers. Overall, the document analyzes the Indian microfinance landscape and proposes ways to address ongoing challenges.
Awareness on financial products of axis bankRitu Raj
The document discusses the history and operations of Axis Bank in India. It provides details about Axis Bank such as it being the third largest private sector bank in India, having 2402 branches and 12,922 ATMs. The document also summarizes findings from a customer survey, noting that most Axis Bank customers have savings accounts, and that accounts are more popular than other products like loans and investments. It recommends that Axis Bank should promote these other products more aggressively.
The document provides an overview of the banking system in India. It discusses the history and nationalization of banks in India. There are currently 88 scheduled commercial banks in India, including 27 public sector banks, 31 private banks, and 38 foreign banks. The document then examines three specific banks - The Jammu & Kashmir Bank Limited, Kotak Mahindra Bank, and The Saraswat Co-operative Bank Limited - comparing their account types, services, and operating policies. Both public and private sector banks in India have grown in recent decades and contributed significantly to the Indian economy.
Sustaining the development of the country will require current levels of growth to trickle down to the poorest and more excluded of society. A critical way to extend these benefits will be to bring people into the formal sector of finance, whereby they may have more reliable and cheaper access to their financial needs of remittances, savings, borrowings etc. Many models have been suggested as alternatives to traditional branch banking, the current penetration of which is abysmally low. Options include mobile banking, enlisting business correspondents, encouraging MFIs, etc., and each option has its strengths and weaknesses. The models with the greatest potential for the future should be able to leverage on existing retail networks and the rapidly expanding ICT (information and communication technology) platform. As such, the BC model, clubbed with m-banking technology, holds the greatest promise to achieving universal inclusion and steps must be taken to encourage its sustained proliferation
Summer intership project Customer statisfaction leval tpward service provided...Pritesh Radadiya
This document is a project report submitted for an MBA program. It provides an overview of a study conducted on customer satisfaction levels towards services provided by Rajkot People Co-operative Bank Ltd. The 3-page summary includes:
1) An introduction to co-operative banking in India, including a definition, history, importance and differences between co-operative and commercial banks.
2) An executive summary of the report, which analyzed services like loans, lockers, deposits and more through primary data collection to understand customer satisfaction.
3) An index of the full report, which contains sections on the bank's history and performance, products/services, research methodology used, data analysis and findings, suggestions and
“Customer satisfaction in public sector banks”AssassinCG
This document provides an introduction and background on a project report about customer satisfaction in public sector banks in India. It discusses the history and emergence of public sector banks in India through nationalization in the 1950s and 1980s. It also discusses the objectives and role of public sector banks before and after economic reforms in the early 1990s. The document outlines the chapters that will be covered in the project report, including the introduction, literature review, research methodology, data analysis, findings, and conclusions.
This document is a project report submitted by Vedansh Jain to Jagannath Institute of Management Studies. The report provides an overview of Axis Bank, including its history, products, and services. It discusses Axis Bank's retail banking, corporate banking, and financial performance. The report also examines various loan and credit card products offered by Axis Bank, including details on eligibility, documentation requirements, and interest rates.
Axis Bank was formerly known as UTI Bank. It had to change its name from UTI Bank to Axis Bank for several reasons, including no longer being allowed to use the UTI brand name without paying royalty fees. Axis Bank underwent a major rebranding effort, adopting a new logo and color scheme to establish its own identity independent of UTI. Axis Bank has grown significantly since its founding, expanding its branch network across India and internationally while increasing its customer base and offerings in retail, corporate, and investment banking.
This document provides a summary of an internship report submitted by Arjun P R at Dhanlaxmi Bank Ltd. It begins with an introduction and outlines the objectives of the internship which were to learn about the functional and managerial aspects of the bank. It then discusses the sources of data collected, limitations faced, and provides an industry profile of the banking sector in India. Finally, it gives an overview of Dhanlaxmi Bank Ltd, describing its founding, expansion, services, technology initiatives, and current business.
Project on SBI -
I would like to acknowledge a deep sense of gratitude to Mr. Hitesh Rawat, Senior Manager of State Bank of India at Kalbadevi Road, Mumbai for giving me the opportunity & time to work on this project and given me all vital input which has led to completion of this project. Without their guidance this project would have remained in pipe dream.
I am also thankful to State Bank of India employees, who directly & indirectly extended their co-operation and invaluable support to me
This document provides information about Surjit Singh's industrial training project report on his internship at ThinkNEXT Technologies Pvt. Ltd. It includes declarations, acknowledgements, details about the company such as its vision, management team, and services provided. The objectives of the study are to understand the functioning of depositories, benefits to investors and brokers, and dematerialization process. Key points covered are the history of depositories in India including the establishment of National Securities Depository Limited and its role in developing the financial services industry.
This document provides an overview of Axis Bank's marketing communications plan. It discusses Axis Bank's history and services offered. It then analyzes the bank's target markets including corporate, retail and business banking. It discusses Axis Bank's positioning as a customer-centric and innovative bank. The document also analyzes Axis Bank's competitors and develops strategies to differentiate itself in the market. Finally, it outlines Axis Bank's marketing objectives and communication goals to improve its brand image and market share.
In the age of competition banking industry is facing increasing competition form
not only private banks and International markets. The assumption is made or it is
expected that the operational structure of banking in India will be changed in the
near future due to the emergence of new private banks. The private banks are
more enriched and diversified in spreading the wholesale as well as retail
banking. The speedy expansion and diversification of private sector banks has led
new challenges in front of the banking sector. Banking sector is coming with new
strategies and policies to cope with the changing environment to face the
competition. The existing banks getting the benefits of their wide branch network
and geographic spread whereas new emerging private banks have the massive
capital, lean personnel components expertise to develop financial product and use
of state of the act technology. It has become very difficult to maintain balance
between efficiency and stability as the banking institutions are increasing in
present corporate environment.Banking institutions becoming complex under the
impact of deregulation, innovation and technological up gradation. During the
last 30years, since nationalisation tremendous changes have been seen in the
financial markets as well as in the banking industry due to the financial sector
reform. Now the banks are not more functioning on their traditional functions but they are innovating improving and coming out with the new types of services to
full fit the emerging need of their customers. This paper explains the
developments in the banking sector, significance of banking sector, new reforms,
challenges faced by banking sector.
In the age of competition banking industry is facing increasing competition form not only private banks and International markets. The assumption is made or it is expected that the operational structure of banking in India will be changed in the near future due to the emergence of new private banks. The private banks are more enriched and diversified in spreading the wholesale as well as retail banking. The speedy expansion and diversification of private sector banks has led new challenges in front of the banking sector. Banking sector is coming with new strategies and policies to cope with the changing environment to face the competition. The existing banks getting the benefits of their wide branch network and geographic spread whereas new emerging private banks have the massive capital, lean personnel components expertise to develop financial product and use of state of the act technology. It has become very difficult to maintain balance between efficiency and stability as the banking institutions are increasing in present corporate environment.Banking institutions becoming complex under the impact of deregulation, innovation and technological up gradation. During the last 30years, since nationalisation tremendous changes have been seen in the financial markets as well as in the banking industry due to the financial sector reform. Now the banks are not more functioning on their traditional functions but they are innovating improving and coming out with the new types of services to full fit the emerging need of their customers. This paper explains the developments in the banking sector, significance of banking sector, new reforms, challenges faced by banking sector.
Javascript errors are nasty. All too often when a developer writes a web application, they may write fantastic unit and functional tests, but forget that all-important final layer of testing Javascript. Few enjoy debugging scripting errors, so we’ll take a look at how to use libraries like Screw.Unit, Smoke, JSpec, and JSocka to help address those typos, errors, and even more dangerous design issues of “Doing the wrong thing right.”
The document discusses the 2007 Carnaval de Barranquilla festival in Colombia. It provides brief news reports from the festival from multiple news agencies including the Associated Press and EFE. The high-level information is that the document covers the 2007 festival through short news snippets.
Nicolás Copérnico (1473-1543) fue un astrónomo polaco que propuso un modelo heliocéntrico del sistema solar donde el Sol está quieto en el centro y los planetas, incluida la Tierra, giran a su alrededor. Publicó su teoría en 1543 tras años de estudio en universidades de Polonia e Italia. Su trabajo revolucionó la astronomía al reemplazar el modelo geocéntrico de Ptolomeo y sentó las bases para los descubrimientos posteriores de Kepler y Newton. Copérnico es
The document discusses financial inclusion in India and the business correspondent model. It notes that while financial inclusion has received more attention, reaching all of India's population remains a challenge given limited bank branch infrastructure. The business correspondent model, using information and communication technologies like mobile phones, shows promise in expanding access in a more cost-effective way. Recent deregulation and policies are helping proliferation of this branchless banking model, but issues around interoperability, infrastructure, and incentives still need addressing as the field expands further.
Axis Bank rebranded itself from UTI Bank in 2007 for three main reasons: they had to give up the UTI name after 13 years of using it as they were not willing to accept terms from UTI AMC, including paying royalty fees; the recommendation to change the name came from brand confusion generated by other unrelated entities using the UTI brand; and the name UTI Bank implied it was a government bank so they wanted their own unique brand identity. The bank spent around Rs. 50 crore on the rebranding exercise, hiring advertising firm Ogilvy & Mather to design and implement the new Axis Bank brand, including a new logo depicting a strong growth path supported by a strong base.
An Infrastructure Development Of Airtel Payment BankSushmitaGour2
The document appears to be an internship report submitted by a student named Sushmita Gour detailing her 60 day internship with Airtel Payments Bank in Bhopal, India where she helped onboard new merchants and activate existing merchants while learning about the company's operations, strategies, and banking services. The report includes an introduction to Airtel Payments Bank, descriptions of the organization structure and departments, a review of the company's objectives and values, and a weekly overview of the internship activities performed.
This document provides an overview of Axis Bank, including:
- Axis Bank was established in 1994 as the first private sector bank after reforms allowed private banks. It was jointly promoted by UTI, LIC, and other insurers.
- Axis Bank is now the third largest private sector bank in India with over 1,700 branches across the country.
- The document outlines Axis Bank's business activities, subsidiaries, promoters including UTI and LIC, and its position as one of the leading banking franchises in India.
This document summarizes issues and developments in the microfinance sector in India. It discusses the evolution of microfinance from credit cooperative movements to the commercialization of microfinance institutions (MFIs). It highlights key issues like multiple borrowing, lack of regulation, and the 2010 Andhra Pradesh crisis. The document recommends increased use of microfinance rating agencies and technology to improve the sector. Rating agencies can evaluate MFIs' financial and social performance, while technology can make operations more efficient and enable MFIs to reach more customers. Overall, the document analyzes the Indian microfinance landscape and proposes ways to address ongoing challenges.
Awareness on financial products of axis bankRitu Raj
The document discusses the history and operations of Axis Bank in India. It provides details about Axis Bank such as it being the third largest private sector bank in India, having 2402 branches and 12,922 ATMs. The document also summarizes findings from a customer survey, noting that most Axis Bank customers have savings accounts, and that accounts are more popular than other products like loans and investments. It recommends that Axis Bank should promote these other products more aggressively.
The document provides an overview of the banking system in India. It discusses the history and nationalization of banks in India. There are currently 88 scheduled commercial banks in India, including 27 public sector banks, 31 private banks, and 38 foreign banks. The document then examines three specific banks - The Jammu & Kashmir Bank Limited, Kotak Mahindra Bank, and The Saraswat Co-operative Bank Limited - comparing their account types, services, and operating policies. Both public and private sector banks in India have grown in recent decades and contributed significantly to the Indian economy.
Sustaining the development of the country will require current levels of growth to trickle down to the poorest and more excluded of society. A critical way to extend these benefits will be to bring people into the formal sector of finance, whereby they may have more reliable and cheaper access to their financial needs of remittances, savings, borrowings etc. Many models have been suggested as alternatives to traditional branch banking, the current penetration of which is abysmally low. Options include mobile banking, enlisting business correspondents, encouraging MFIs, etc., and each option has its strengths and weaknesses. The models with the greatest potential for the future should be able to leverage on existing retail networks and the rapidly expanding ICT (information and communication technology) platform. As such, the BC model, clubbed with m-banking technology, holds the greatest promise to achieving universal inclusion and steps must be taken to encourage its sustained proliferation
Summer intership project Customer statisfaction leval tpward service provided...Pritesh Radadiya
This document is a project report submitted for an MBA program. It provides an overview of a study conducted on customer satisfaction levels towards services provided by Rajkot People Co-operative Bank Ltd. The 3-page summary includes:
1) An introduction to co-operative banking in India, including a definition, history, importance and differences between co-operative and commercial banks.
2) An executive summary of the report, which analyzed services like loans, lockers, deposits and more through primary data collection to understand customer satisfaction.
3) An index of the full report, which contains sections on the bank's history and performance, products/services, research methodology used, data analysis and findings, suggestions and
“Customer satisfaction in public sector banks”AssassinCG
This document provides an introduction and background on a project report about customer satisfaction in public sector banks in India. It discusses the history and emergence of public sector banks in India through nationalization in the 1950s and 1980s. It also discusses the objectives and role of public sector banks before and after economic reforms in the early 1990s. The document outlines the chapters that will be covered in the project report, including the introduction, literature review, research methodology, data analysis, findings, and conclusions.
This document is a project report submitted by Vedansh Jain to Jagannath Institute of Management Studies. The report provides an overview of Axis Bank, including its history, products, and services. It discusses Axis Bank's retail banking, corporate banking, and financial performance. The report also examines various loan and credit card products offered by Axis Bank, including details on eligibility, documentation requirements, and interest rates.
Axis Bank was formerly known as UTI Bank. It had to change its name from UTI Bank to Axis Bank for several reasons, including no longer being allowed to use the UTI brand name without paying royalty fees. Axis Bank underwent a major rebranding effort, adopting a new logo and color scheme to establish its own identity independent of UTI. Axis Bank has grown significantly since its founding, expanding its branch network across India and internationally while increasing its customer base and offerings in retail, corporate, and investment banking.
This document provides a summary of an internship report submitted by Arjun P R at Dhanlaxmi Bank Ltd. It begins with an introduction and outlines the objectives of the internship which were to learn about the functional and managerial aspects of the bank. It then discusses the sources of data collected, limitations faced, and provides an industry profile of the banking sector in India. Finally, it gives an overview of Dhanlaxmi Bank Ltd, describing its founding, expansion, services, technology initiatives, and current business.
Project on SBI -
I would like to acknowledge a deep sense of gratitude to Mr. Hitesh Rawat, Senior Manager of State Bank of India at Kalbadevi Road, Mumbai for giving me the opportunity & time to work on this project and given me all vital input which has led to completion of this project. Without their guidance this project would have remained in pipe dream.
I am also thankful to State Bank of India employees, who directly & indirectly extended their co-operation and invaluable support to me
This document provides information about Surjit Singh's industrial training project report on his internship at ThinkNEXT Technologies Pvt. Ltd. It includes declarations, acknowledgements, details about the company such as its vision, management team, and services provided. The objectives of the study are to understand the functioning of depositories, benefits to investors and brokers, and dematerialization process. Key points covered are the history of depositories in India including the establishment of National Securities Depository Limited and its role in developing the financial services industry.
This document provides an overview of Axis Bank's marketing communications plan. It discusses Axis Bank's history and services offered. It then analyzes the bank's target markets including corporate, retail and business banking. It discusses Axis Bank's positioning as a customer-centric and innovative bank. The document also analyzes Axis Bank's competitors and develops strategies to differentiate itself in the market. Finally, it outlines Axis Bank's marketing objectives and communication goals to improve its brand image and market share.
In the age of competition banking industry is facing increasing competition form
not only private banks and International markets. The assumption is made or it is
expected that the operational structure of banking in India will be changed in the
near future due to the emergence of new private banks. The private banks are
more enriched and diversified in spreading the wholesale as well as retail
banking. The speedy expansion and diversification of private sector banks has led
new challenges in front of the banking sector. Banking sector is coming with new
strategies and policies to cope with the changing environment to face the
competition. The existing banks getting the benefits of their wide branch network
and geographic spread whereas new emerging private banks have the massive
capital, lean personnel components expertise to develop financial product and use
of state of the act technology. It has become very difficult to maintain balance
between efficiency and stability as the banking institutions are increasing in
present corporate environment.Banking institutions becoming complex under the
impact of deregulation, innovation and technological up gradation. During the
last 30years, since nationalisation tremendous changes have been seen in the
financial markets as well as in the banking industry due to the financial sector
reform. Now the banks are not more functioning on their traditional functions but they are innovating improving and coming out with the new types of services to
full fit the emerging need of their customers. This paper explains the
developments in the banking sector, significance of banking sector, new reforms,
challenges faced by banking sector.
In the age of competition banking industry is facing increasing competition form not only private banks and International markets. The assumption is made or it is expected that the operational structure of banking in India will be changed in the near future due to the emergence of new private banks. The private banks are more enriched and diversified in spreading the wholesale as well as retail banking. The speedy expansion and diversification of private sector banks has led new challenges in front of the banking sector. Banking sector is coming with new strategies and policies to cope with the changing environment to face the competition. The existing banks getting the benefits of their wide branch network and geographic spread whereas new emerging private banks have the massive capital, lean personnel components expertise to develop financial product and use of state of the act technology. It has become very difficult to maintain balance between efficiency and stability as the banking institutions are increasing in present corporate environment.Banking institutions becoming complex under the impact of deregulation, innovation and technological up gradation. During the last 30years, since nationalisation tremendous changes have been seen in the financial markets as well as in the banking industry due to the financial sector reform. Now the banks are not more functioning on their traditional functions but they are innovating improving and coming out with the new types of services to full fit the emerging need of their customers. This paper explains the developments in the banking sector, significance of banking sector, new reforms, challenges faced by banking sector.
Javascript errors are nasty. All too often when a developer writes a web application, they may write fantastic unit and functional tests, but forget that all-important final layer of testing Javascript. Few enjoy debugging scripting errors, so we’ll take a look at how to use libraries like Screw.Unit, Smoke, JSpec, and JSocka to help address those typos, errors, and even more dangerous design issues of “Doing the wrong thing right.”
The document discusses the 2007 Carnaval de Barranquilla festival in Colombia. It provides brief news reports from the festival from multiple news agencies including the Associated Press and EFE. The high-level information is that the document covers the 2007 festival through short news snippets.
Nicolás Copérnico (1473-1543) fue un astrónomo polaco que propuso un modelo heliocéntrico del sistema solar donde el Sol está quieto en el centro y los planetas, incluida la Tierra, giran a su alrededor. Publicó su teoría en 1543 tras años de estudio en universidades de Polonia e Italia. Su trabajo revolucionó la astronomía al reemplazar el modelo geocéntrico de Ptolomeo y sentó las bases para los descubrimientos posteriores de Kepler y Newton. Copérnico es
This document provides instructions for making a sweet pastry tart with a cheese filling. It begins by listing the necessary ingredients for the sweet pastry: butter or margarine, icing sugar, egg, and flour. The steps for making the pastry include beating the butter and icing sugar, adding the egg, then mixing in the flour to form dough. The dough is pressed into a tart container and baked. The cheese filling recipe calls for cream cheese, butter, icing sugar, eggs, and lemon juice. The filling is piped into the baked tart shell and garnished with blueberries before final baking. Proper hygiene such as washing hands and keeping equipment clean is emphasized when preparing food.
Este documento presenta el plan de estudios para la semana 3 de un curso en línea de la Universidad Pedagógica Veracruzana. Los estudiantes continuarán revisando el módulo 2 sobre la importancia de fijar metas y completarán una tarea sobre este tema que debe entregarse el 8 de noviembre. El documento también incluye información sobre foros, preguntas frecuentes y apoyo técnico disponible.
The document summarizes the benefits of working with Senior Security Benefits as an insurance agent. It offers a 21% commission for ages 65+, an "A-" rating, and lead generation and fast start bonuses. Agents can qualify for bonuses by writing a minimum number of Medicare supplement or advantage plans. Senior Security Benefits also provides referral bonuses, pre-set appointments, and dedicated support to help agents grow their business.
Earning formal academic credit through a citizen’s viral and OER learning (Id...Merilyn Childs
Earning formal academic credit through a citizen’s viral and OER learning
What are the implications for mobile, hybrid and online learning? Ideas paper presented at: eLmL 2013, The Fifth International Conference on Mobile, Hybrid, and Online Learning, February 24th to March 1st, 2013, Nice, France.
This document discusses how banks can satisfy customers and remain profitable through competition. It suggests developing a smartphone app that allows contactless payment through sensors instead of physical cards. This would eliminate the need to carry multiple cards and risk of loss or theft. The app could be used to pay at ATMs and stores. A second app is proposed to check wait times at bank locations and navigate customers to the nearest quietest branch. This aims to improve the customer experience and retain existing customers.
El documento presenta información sobre Nicolas Esteban Mantilla Velez. En pocas palabras, el texto se refiere a la persona que lo creó, Nicolas Esteban Mantilla Velez.
Este documento proporciona instrucciones para hacer una empanada de mazá. Incluye una lista de ingredientes como mazá, canela y azúcar para rellenar la masa de follado. Las instrucciones detallan los pasos de pelar, cortar y mezclar las mazás con limón antes de colocar el relleno sobre la masa y cubrirla. Finalmente, la empanada se hornea, se deja enfriar y se prueba.
This presentation discusses key points about presentation number one. The presentation covers an overview of the topic and provides background information. In conclusion, presentation one lays the foundation for further discussion on the subject matter.
1. Financial inclusion aims to provide banking services to low-income groups so that more people can access banking, while Digital India aims to provide government services electronically.
2. Digital India can help achieve financial inclusion goals by easily connecting different groups through digital banking and payment systems.
3. Initiatives under Digital India like internet connectivity, e-services, IT training, and digital lockers make the path to financial inclusion easier by allowing electronic access for all citizens.
Pradhan mantri jan dhan yojna pmjdy a new direction for mainstreaming the fin...IAEME Publication
The document discusses the Pradhan Mantri Jan Dhan Yojana (PMJDY) scheme launched in India in 2014 to promote financial inclusion. It aims to provide universal access to banking facilities, basic savings accounts, need-based credit, remittances, insurance and pension. The key objectives are achieving universal access to banking, providing RuPay debit cards and overdraft facilities to households, financial literacy programs, and credit guarantee and micro-insurance schemes. While progress has been made, challenges remain in reaching remote unbanked areas and developing simple, user-friendly services and products for low-income groups. The study examines the level of financial access and awareness of the scheme among urban informal workers in Odisha,
This document discusses financial inclusion in India. It defines financial inclusion as ensuring access to financial services for vulnerable groups at affordable costs. It outlines various definitions of financial inclusion from organizations like ADB, UN, and the Rangarajan Committee. It discusses the historical perspective of financial inclusion in India since the 1950s. It notes that while access to financial services has increased, 100% inclusion has not been achieved. The document reviews several studies on topics like the level of inclusion in various Indian states and cities. It discusses the need for financial inclusion to promote equitable growth, poverty eradication, and sustainable livelihoods. Finally, it outlines the research methodology used in a case study on financial inclusion in an Indian village.
This document summarizes a report on expanding access to banking services in Bihar. It finds that Bihar has very limited exposure to banking and the lowest availability of financial services in India. It recommends a two-pronged strategy: 1) Developing high-quality local financial institutions like microfinance institutions (MFIs) that partner with national banks; 2) Building technology-enabled low-cost direct service channels. Other recommendations include strengthening self-help groups, adopting cluster-based lending, revitalizing cooperatives, utilizing business correspondents, and improving cash infrastructure like currency chests. The goal is to make financial services more ubiquitous, comprehensive, and cost-effective in rural Bihar.
Case Study On The Growing Saga of E - Payment SystemVARUN KESAVAN
Every country has a financial system of its own that serves as backbone of its entire development. A financial system is a set of institutional arrangements through which financial surplus in the economy is mobilized from surplus units and transferred to deficit spenders. The financial system of any country consists of banking and non banking financial institutes, these institutes are providing various types of financial services to the customers. In the financial services, financial clearing and fund transfer service is most important service than other services. Payment systems improve financial intelligibility, stimulating business growth and consumption .The success of the banking system has depends upon the efficient and quality of clearing system of the industry. If we overlook the worldwide this system has changing drastically with technological advancements. Last few years evident that, Information and Communication Technology (ICT) have become a mean for improvement of financial system worldwide. In India, most of banks and financial institutions are offering ICT based financial products and services to improve their business efficiency and speed of services e.g. called e - banking, internet banking, electronic fund transfer, electronic clearing, mobile banking etc.
Banks play a very favorable and dynamic role in the economic life of every contemporary state. In the past few
years, there has been rapid growth in the banking sector of the Indian financial system. Cooperative banks
(Rural and Urban) in India has become an important step towards the attainment of financial inclusion. These
banks have become an integral part of the Indian Financial system. Since the commencement of Cooperative
banks, these banks have achieved milestones and helped Indian Citizens to inculcate the habit of savings,
helping them to improve the capital formation in the economy and mobilizing savings in a productive
manner. Cooperative banks also offer services to citizens at ease and at very affordable rates. The lending and
borrowing functions of the cooperative banks have resulted in credit creation in the economy.
A study of Branchless banking for financial inclusion in India!L S Subramanian
Branchless banking plays a key role in achieving financial inclusion in India. It provides banking services to the large unbanked population through methods like business correspondents and use of technologies like mobile phones. Studies show over 50% of Indian households do not have access to formal banking. The government and Reserve Bank of India have implemented policies like the National Rural Financial Inclusion Plan to increase access through branchless models. Research found branchless banking has benefited customers by providing convenient, affordable services. However, more financial education is still needed and future models could offer additional products like insurance to further help low-income groups.
The document summarizes key points from the Materials Management Review newsletter dated July 2016. It discusses India's logistics industry which is growing at 15% annually but faces challenges of infrastructure bottlenecks and lack of trained workforce. The implementation of GST is expected to cut high logistics costs significantly. The newsletter also provides an overview of the Model GST Law recently released by the Empowered Committee of State Finance Ministers, outlining key definitions and provisions.
This document appears to be a chapter from a student's research project on perceptions of people towards the Pradhan Mantri Jan Dhan Yojana (PMJDY) program in India. The chapter provides background on financial inclusion in India and defines key terms. It discusses the objectives and importance of PMJDY, launched in 2014 to provide universal access to banking services. Key elements of PMJDY include opening bank accounts for all that can be held at zero balance and linking them to Aadhaar cards and Rupay debit cards. Over 16 crore accounts were opened under the scheme by June 2015, with over Rs. 18,000 crore deposited.
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The document is a research report on the Indian financial system submitted for a Business Finance course. It discusses the key components of the Indian financial system including financial institutions, markets, instruments and services. It provides details on various types of banking and non-banking financial institutions, organized and unorganized financial markets, cash and derivative financial instruments, and fund-based and fee-based financial services. The report concludes that a well-developed financial system is important for economic growth in India and there is a need for effective management and regulation among different parts of the system.
India FinTech Report 2020 - 2nd edition, Executive SummaryMEDICI Inner Circle
- India has emerged as one of the fastest growing FinTech hubs in recent years, with hundreds of new startups being founded each month.
- Government initiatives like demonetization boosted digital payments and the growth of FinTech companies in India.
- However, the FinTech revolution needs to also drive financial inclusion, especially reaching underbanked and unbanked communities in rural areas. Most startups currently do not operate in those segments serving people with incomes of less than $1,300 per year.
- For FinTech to fully enable financial inclusion in India, costs need to be reduced through technology while also creating incentives and financial education for rural populations to use digital payments and services.
Banking Sector in Rural India - Challenges and OpportunitiesAkshay Panwar
This dissertation examines the situation of the Banking Sector in Rural India through studying the obstacles and bottlenecks that have caused underdevelopment of banking services and products in rural Indian areas. Contrary popular belief lack of capital to invest for improving banking is not only the reason why the sector is underdeveloped. Banking has been affected by challenges such as technology displacement and radical innovation of technology, vast demographic of India, lack of liquidity, lack of services understanding amongst customers, weak policies and the unwillingness of talented bank employees to work in rural India.
As a result, it is going to take time, investments, overall development of villages and introduction of innovative schemes and policies to change the state of banking in Rural India. There have been several research papers published and survey groups that have tried to explore Rural Banking but the market and economy keeps constantly changing alongside a
lot more about Rural Banking yet to be explored.
We took the above variables in account and developed a theoretical framework containing the dependent and independent variables along with the null and alternate hypotheses that had to be proved true or false depending upon the data collection.
We prepared two questionnaires targeted to Bankers and customers in Rural India to get perspectives and insights from the service providers and from users. Stratified sampling was
used to gather appropriate data.
The data collected was analysed using the SPSS software for which a set of analysis techniques were applied and the data was interpreted which helped in proving the corresponding null or alternate hypotheses true as per the requirement of the research.
Analytical study on contribution of private banks in the success of pradhan m...IJLT EMAS
With a view to bring about a complete financial
inclusion of all the households in the country, on 15 August, 2014
‘Pradhan Mantri Jan-Dhan Yojana’ was announced by
Honorable Prime Minister, ‘Mr. Narendra Damodar Modi’. This
held to be a very serious National Mission on Financial Inclusion
for bringing a paradigm shift to highest level of transparency
together with Governance.
It was realized that financial inclusion is the essence of
sustainable economic growth and development of a country. To
strategize this vision it was felt that large sections of the rural
population should come within the ambit of banking system.
Attempts at every corner were made by the policymakers and
financial institutions and no stone was left unturned.
Financial Inclusion is an unavoidable factor for the economic
development of a country without which the progress shall
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total population remains outside the growth process.
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neglect the role of private banks in ensuring the access to
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to analyze their contributions through this paper.
A Descriptive Study on Trends in Indian Banking Sectorijtsrd
Banking sector assumes an essential job in the improvement of one nations economy. The development of the banking segment relies on the administrations given by them to the clients in different viewpoints. The developing pattern of banking administrations is discovered huge after the new financial changes in India. Today, India has a genuinely very much created financial framework with various classes of banks open part banks, outside banks, private area banks both old and new age, local country banks and co employable manages an account with the Reserve Bank of India as the wellspring Head of the framework. These days the banking area goes about as a spine of Indian economy which reflects as a supporter during the time of blast and subsidence. From 1991 different patterns and improvements in the banking division are credited. It likewise mirrors the different changes were caused to improve their administrations to fulfill the clients. S. Lyrics Miruna "A Descriptive Study on Trends in Indian Banking Sector" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-3 | Issue-5 , August 2019, URL: https://www.ijtsrd.com/papers/ijtsrd25234.pdfPaper URL: https://www.ijtsrd.com/management/other/25234/a-descriptive-study-on-trends-in-indian-banking-sector/s-lyrics-miruna
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India FinTech Report 2019 offers an in-depth look at what makes the Indian FinTech ecosystem vibrant by taking a deeper dive into Government, Regulatory, and Private sector initiatives.
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- Urban population in India is growing rapidly at 2.8% CAGR compared to the overall population growth of 1.6% CAGR. 377 million people currently live in urban areas, expected to increase to over 40% of the total population by 2030.
- There is a need for efficient, sustainable and reliable public transportation systems across Indian cities to accommodate this urban population growth. Currently, public transportation modal share is low and personal vehicles are preferred.
- Successful mass rapid transit systems can help shift the modal share towards public transportation by providing accessible, affordable and efficient travel options for the growing urban populations. Major investments are required in urban transportation infrastructure to address this need.
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1. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 1
REPORT OF THE EXPERT COMMITTEE ON
HARNESSING THE INDIA POST NETWORK
FOR FINANCIAL INCLUSION
June 16, 2010, New Delhi
Jointly Commissioned and Produced by
Please direct your questions and comments to gautam@iief.com
Department of Post
Ministry of Communications & IT
Government of India
Department of Financial Services
Ministry of Finance
Government of India
Department of Economic Affairs
Ministry of Finance
Government of India
Invest India Economic
Foundation (IIEF)
2. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 2
June 30, 2010
Shri S. Samant
Member, Postal Services Board
Department of Post
Ministry of IT and Communications
Government of India
Dak Bhavan, Parliament Street
New Delhi 110 001
Report on Harnessing the India Post Network for Financial Inclusion
Dear Shri Samant,
I am very pleased to submit the Report of the Expert Committee on Harnessing the India Post
Network for Financial Inclusion produced jointly by the Department of Financial Services,
Department of Economic Affairs, Department of Post and Invest India Economic Foundation
(IIEF).
This Report has had the benefit of ideas and inputs from a Committee that represents many
potential users of the India Post outreach. This, coupled with our focus on a demandside
view of
Indian finance has ensured that our recommendations for population wide banking, payments and
emergency credit access are in line with both the Government's focus on financial inclusion and
the India Post capacity and role in delivery of essential financial services to everyday Indians.
Many Expert Committee members and Technical Experts on the Committee have contributed
background papers for the Report, and have drawn others from their organizations to help in the
work. This has been truly a collective effort, and I would like to express my sincere gratitude to
Dr. K.P. Krishnan, Sukriti Likhi, Dr. Shashank Saksena, Ashok Pal Singh, Dr. Viral Shah,
A.S. Prasad, Manisha Sinha, Vijay Mahajan, Ashish Aggarwal, Ramesh Ramanathan, Dr. Kshama
Fernandes, T.V. Seshadri, Sanjeev Kapoor, Anil Misquith, Karan Bajwa, Sushant Kumar and
Sudeep Yadav. Gautam Bhardwaj who served as the convenor and membersecretary
of the Expert
Committee, and Dr. Viral Shah worked actively with me on putting together the final report and on
obtaining valuable feedback and ideas from a variety of key stakeholders and potential users of the
postal network.
I must acknowledge Anuradha and her team at IIEF for hosting the Committee’s many
consultations, and creating a resource secretariat to take care of the logistical arrangements. I
particularly thank IIEF for making available data and analysis from Invest India's Incomes and
Savings Survey 2007 (IIISS07) that directed the Committee’s thinking on the present gaps in
financial inclusion.
The Committee is especially grateful to Citibank N.A., Intel Corporation, ICICI Bank, Infosys
Technologies, Microsoft Corporation and MasterCard International for their support as cosponsors.
...continued
3. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 3
Page two
The Committee greatly appreciates also ongoing inputs from our “virtual” members: Gautam
Bandyopadhyay, Khushnama Davar, Piyush Choudhary, Manish Gupta, Rajib Ranjan, Navneet
Taneja, Vibha Mehra, Ambujam H, V. S. Radhakrishnan, Ganesh Vaidyanathan, Anirudh
Srivastava, Manish Lodha and Nikhil Gahlot. Each of them contributed in the writing of
significant portions of the Report, and greatly enhanced the intellectual quality and practical
content of the Committee’s discussions.
The Committee is particularly grateful for your own time and ongoing guidance in our
deliberations on the potential role for India Post in mitigating a range of insurable risks of India's
excluded population and especially the poor.
Sincerely,
Ajay Shah
Chairman, Expert Committee
4. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 4
Contents
1. Executive Summary ................................................................................ 5
2. Context ................................................................................................... 11
2.1 Principles ........................................................................................ 14
3. Savings Accounts .................................................................................. 16
4. Payments ................................................................................................ 18
4.1 EuroGiro – A case study ................................................................. 18
4.2 India Post Payments Network (IPPN) ............................................. 19
4.3 Technology ....................................................................................... 21
5. Credit ..................................................................................................... 23
5.1 Principles ........................................................................................ 24
5.2 Mechanism for Microloans
through India Post .............................. 25
5.3 Comparative Advantage ................................................................ 25
5.4 Implementation of Microloans
...................................................... 26
6. Implementation Related Issues ........................................................... 28
6.1 Scope of POSB Role and Functions .............................................. 28
6.2 AML/ CFT Compliance ................................................................... 28
7. Summary Recommendations .............................................................. 30
8. Conclusion ............................................................................................ 32
Annexure 1
Expert Committee ................................................................................... 33
Technical Experts ................................................................................... 34
5. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 5
section one
EXECUTIVE SUMMARY
The India Post network with over 155,000 branches is twice as large as the outreach of all
commercial banks in India put together. Over the years, the Post Office Savings Bank
(POSB) has emerged as significant component of India Post operations and its revenues
from financial services as a share of its total revenue have steadily increased over time to
45 percent today.
While the phrase 'financial inclusion' is relatively new, it is obvious that post offices were
working on problems of financial inclusion many decades before the phrase was coined.
The National Postal Policy1 also visualises an important continued role for India Post in
delivering broadbased
banking and financial services:
“Nearly 16 crore people use India Post to save Rs. 3,23,781 crore as on March 31,
2007. Out of this, deposits in savings bank account alone is Rs.16,789 crore. There
is, therefore, a need for India Post to computerize and connect all its savings bank
accounts so as to widen and deepen the level of financial transactions and offer
banking services to the rural population. India Post sees a great opportunity for
increasing the number of accounts and volume of savings.”
This Expert Committee was constituted to examine potential synergies between the efforts
at broadbased
banking and financial services delivery at India Post and the larger policy
goal of financial inclusion. The Expert Committee examined the role for the postal
network in financial inclusion in the context of the presently unmet demand for financial
services, the core strengths and capabilities of India Post, as well as of the emerging
policy, regulatory and business environment in this area.
Based on extensive finance consumer research and consultations with key stakeholders,
the Expert Committee is of the opinion that succeeding with universal access to financial
services will require a considerable role for post offices. In parallel, and as some
traditional functions of the postal network are being supplanted by new technologies such
as email, India Post is also in the process of carving out a larger role for itself. Therefore,
there is a remarkable coincidence of needs between the twin problems of (a) charting the
1 The National Postal Policy: http://www.indiapost.gov.in/National_Postal_Policy.htm
6. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 6
future for India Post, and (b) resolving India's challenges of financial inclusion.
The Recommendations of the Expert Committee are guided also by the role for the State in
producing public goods and fostering publicprivate
partnerships, and implementing
vendor neutral and incentive compatible solutions. India Post will need a further expansion
of its present financial services delivery strategy and capacity in order to perform public
goods functions in the field of financial inclusion in an environment of modern
technology. The Report sketches the contours of this strategy.
The primary building blocks of financial inclusion are storage of cash, payments and
credit. Importantly, India Post already has several decades of experience in performing the
first function through Post Office Savings Bank (POSB) accounts, and the second through
moneyorders.
However, India Post does not yet deliver credit. This Report presents a
unified approach and role for India Post in delivering these core elements of financial
inclusion. It is feasible to harness broadbased
banking and payments infrastructure in
delivering a range of risk management tools including insurance, pension and credit, as
well as a variety of governmenttoperson
(G2P) payments targeted at the presently
excluded population including the poor.
Access to banking services that permit citizens to receive and make payments in a secure
environment is an important launch pad to financial inclusion. However, despite a
prolonged attack on the problem, bank penetration rates around the country remain at only
modest levels. India Post is well placed to actively assist universal banking coverage with a
low cost, lightweight
bank account for all excluded citizens. In an environment with
rapidly evolving hardware and software solutions and a dynamic load requirement, India
Post could achieve low costs, rapid implementation and technology risk minimisation
through an outsourced model for delivering lightweight
POSB accounts. In this model,
India Post could invite competing service providers to bid a cost (or revenueshare)
per
transaction based on the service providers' assessment of the potential market size and
growth, as well as the transaction price that the market will bear.
Recommendation 1: India Post should deliver lightweight, lowcost
bank accounts to all
Indian citizens and especially to the financially excluded population.
India Post can achieve this outcome by establishing contractual arrangements with
multiple IT vendors who will provide an India Post specified application programming
interface (API) and charge a stated low price per transaction (or deliver a stated revenue
per transaction) to India Post. The underlying requirement for data centres, IT systems and
operations management, and the potential for publicprivate
partnerships in this area may
7. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 7
be examined and implemented by India Post in the context of its overall banking and
financial services delivery strategy.
The impact of this proposed effort upon the larger financial inclusion agenda of the
Government can be further amplified by adopting an open architecture and by opening up
interface to business partners such as micro finance institutions (MFIs), mutual fund and
insurance companies, telecom operators and other entities desirous of also reaching and
serving the excluded population including the urban and rural poor. In this way, while the
India Post IT systems for lightweight
bank accounts shall deliver financial inclusion
through post offices, such partners can further the overall inclusion agenda by using the
India Post IT infrastructure at a fee charged by India Post for transactions.
Recommendation 2: India Post should look for ways to leverage its low cost platform by
providing India Post branded accounts to other strategic partners, such as MFIs, mutual
fund and insurance companies, and telecom operators.
By treating its IT capacity for lightweight
bank accounts as a public good, India Post
would increase its impact on financial inclusion. Also, adoption of the POSB
infrastructure by partners would lead to increased accounts and transaction volumes and
induce further economies of scale.
The second fundamental building block of financial inclusion relates to payments. The
dominant role of the 'Postal Giro' in Europe suggests that India Post, which already
provides moneyorders
across the country, can play an important role in payments.
Recommendation 3: India Post should apply itself towards the challenge of achieving
high volumes of moneyorders
where payments of as little as Rs.10 are achieved at a
charge of less than Rs.0.1 while requiring no subsidy from the exchequer.
Drawing upon the experience with the Postal Giro, this will require a tight integration
between POSB accounts and moneyorders.
The payments transaction will involve a
transfer of an account balance from one POSB account to another, without any human
intervention.
Recommendation 4: India Post should evolve the moneyorder
to become a mechanism
for transferring money from one POSB account to another, instead of just being a
mechanism for delivering cash from one person to another.
Given the ubiquity of mobile phones in India today, there is growing recognition of the
utility of mobilebased
financial transactions in the Indian context. For example, a person
8. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 8
with a POSB account should be able to use his mobile phone to make a realtime
moneyorder
of Rs.10 to a street vendor if the street vendor also has a mobile phone and a POSB
account. India Post should charge Rs.0.1 or less for this transaction.
A panIndia
mobilebased
and webbased
payments system linked to POSB accounts can
be equally used for remittances and can effectively replace the traditional postal moneyorder.
As with POSB accounts, the Expert Committee recommends an open architecture
approach for payments under which India Post should sign contracts with all telecom
operators. Similarly, all organisations that sign up to use the India Post IT infrastructure
(for either offering POSB accounts or for offering their own accounts) should
automatically be connected into this new moneyorder
service of India Post.
Recommendation 5: India Post must build a payments infrastructure, through an array of
contracts with partners, connecting up all POSB accounts and accounts of its partners, to
effectively become a persontoperson
moneyorder
capability (through mobile phones or
web browsers) for a large swathe of India.
Payments networks involve network externalities. The value of the platform which India
Post is building is proportional to the square of the number of people participating in it. A
network with twice as many people in it is thus four times as valuable.
Recommendation 6: India Post must elicit a large number of partners in terms of
financial inclusion players, mobile service providers and innovative new technological
choices in order to increase the size of the network.
This payments network integrally connects up with a key problem that government faces
today: that of having a mechanism through which payments such as MGNREGS and
IGNOAPS are directly delivered to citizens.
Recommendation 7: India Post must work closely with a diverse array of government
agencies so that their G2P payments requirements are met through a combination of
POSB accounts held by citizens and moneyorders
delivered by government to those POSB
accounts. The Ministry of Finance should work with India Post in rapidly rolling out this
platform and network, given its important implications for direct, targeted delivery of
government subsidies.
The main body of the Report thus offers an integrated approach to POSB accounts and
moneyorders,
and refashioning these to suit the financial inclusion needs of the 21st
century. This is simultaneously of interest from India's viewpoint – that of achieving
9. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 9
financial inclusion and more efficiently running government programs – and also ensures
that POSB accounts and moneyorders
are not made obsolete by technical and institutional
change.
The Report also proposes a new model for delivering shortdated
noncollateralised
loans
to the poor – an activity that is presently dominated by moneylenders. Recommendations
on credit are based on some essential principles that should be applied. First, India Post
must not give loans to individuals using public money. Second, India Post staff must
exercise no discretionary judgement about the credit quality of a given individual who
approaches a post office for a loan.
The Report presents a mechanism through which the India Post network can deliver shortduration,
fixedsize,
noncollateralised
micro loans (of Rs.500 for one month) while
adhering to these two principles. To achieve this, identification of an individual should be
done through the UIDAI. Each individual loan would be sourced from a network of
competing lenders who would bid an interest rate for the loan on the basis of risk measures
for an individual. The individual would obtain a loan at the lowest interest rate offered by
competing lenders. The successful bidder for the loan would carry the credit risk on its
books. The risk profile of the individual would reside in a database controlled by India
Post. Individual credit history linked to a UID would create a repayment incentive for each
individual. India Post would derive a fee by the lenders for performing these services.
With a combination of UIDs, mobile phones, payments infrastructure and POSB accounts,
it should be feasible also to design a seamless process by which an individual is able to
source an emergency loan at any point using a microATM
or a mobile phone.
Recommendation 8: India Post should play a role in the emergency credit aspect of
financial inclusion, through a platformbuilding
approach where private lenders deliver
credit to the poor through a competitive framework.
Implementation of the recommendations of the Expert Committee would involve
preparation of certain bid documents by India Post. These would cover the specifications
of lightweight POSB accounts, mobilebased
payments, and the creditenabling
framework. Once these documents are prepared, procurement can proceed.
Recommendation 9: India Post should request the addition of its financial inclusion
project into the Terms of Reference of the recently announced Technology Advisory Group
for Unique Projects, and the leadership team of the India Post financial inclusion project
should closely engage in the work of this Group, so as to bring in the best practices for
10. Report of Expert Committee on Harnessing the India Post Network for Financial Inclusion 10
project management.
The 2010 budget speech envisaged an expert group, led by Mr. Nandan Nilekani, chairman
of UIDAI, to examine implementation issues for complex IT projects in government. The
terms of reference of this group focuses on the projects presently being implemented by
the Ministry of Finance: National Treasury Management Agency (NTMA), Goods and
Services Tax (GST), New Pension System (NPS), Expenditure Information Network
(EIN), Tax Information Network (TIN). The implementation challenges of these projects
are identical to those that will be faced in activating post offices for financial inclusion.
Recommendation 10: The role of the Post Office Savings Bank as an agent of the
Ministry of Finance should be revisited and expanded to enable India Post to play a
larger, direct role in financial inclusion and build appropriate enabling architecture.
As per the current Allocation of Business Rules, the Government Savings Banks Act, 1873
is housed within the Ministry of Finance. India Post should engage with the Ministry of
Finance to reexamine
and expand its presently limited agency function to enable the
postal network to more serve effectively as India's financial inclusion platform. This may
require a significant change and expansion in the Allocation of Business Rules for India
Post. Specific recommendations in this regard are beyond the scope this Expert
Committee.
11. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 11
section two
CONTEXT
Indian economic policy emphasises achieving high growth rates coupled with ensuring
that the poor are able to participate in the market economy. This inclusion agenda has
many implications for the field of finance. It involves creating a business environment
through which the poor across the country have easy, secure and affordable access to
critical risk management products.
In the book “Portfolios of the Poor”, the authors describe how the poor in India pay a lot to
access low quality and unreliable financial products. The complex financial needs and
risks faced by the poor require sophisticated financial solutions and risk management
tools. These cannot be scaled down versions of existing products for the rich.
Microfinance institutions (MFIs) in India have shown how credit products can be
restructured to meet the needs of the poor, so that loans can be made at lower interest rates
while still being profitable.
Access to the formal financial system starts with a bank account, and the ability to make
secure payments through that account. Once the ability to make payments is available
ubiquitously, other financial products such as credit, insurance, pensions and mutual funds
can be delivered using this infrastructure. From the 1960s onwards, policy makers have
attempted a variety of initiatives in order to achieve financial inclusion. Major policy
statements of the government in the recent past on this subject include:
1. The Report of the Committee on Financial Inclusion 2 chaired by Dr. C. Rangarajan
describes a comprehensive 179 point strategy for building an inclusive financial sector.
2. The Committee Report – A hundred small steps,: Report of the Committee on
Financial Sector Reforms 3 , chaired by Prof. Raghuram Rajan devotes a full chapter to
financial inclusion. As a simple first step, it advocates a national goal of ensuring in three
2 http://www.nabard.org/report_comfinancial.asp
3 http://planningcommission.nic.in/reports/genrep/report_fr.htm
12. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 12
years that 90 per cent of households have access to a deposit account and to a payments
system, and that government transfers under various schemes be implemented through this
system.
3. The Report of the InterMinisterial
Group on a Framework for Delivery of Banking
Services Via Mobiles 4 proposes a payments solution with mobilelinked
nofrills
accounts. India Post was part of this group and the recommendations of this report are in
harmony with those of the IMG report.
4. A vision document by the Unique Identification Authority of India (UIDAI) – From
Exclusion to Inclusion with Micropayments
5 – provides a comprehensive solution to
achieve this through the use of technology and UID authentication.
Each of these Reports share a common theme: they all emphasize the role of technology in
creating ubiquitous access to savings accounts and a payments network. But the most
recent household survey evidence shows many gaps and that the financial inclusion agenda
for India is far from complete. For example, of India's 321 million strong earning
population aged 18 to 59 years, less than half (45 percent) have bank accounts. In the case
of women earners, penetration rates are even lower at a mere 28 percent. Importantly, and
as can be seen in Table 1, the issue is not only a rural one, for although bank penetration
rates are indeed lower in rural India, in urban India they stand at only 63 percent for male
earners and at 47 percent in the case of women.
Table 1: Bank Penetration Rates among India's Working Age Paid Workforce
Workforce Category Total Rural Urban
All earners aged 1859
years 45% 38% 62%
Shopkeepers 72% 65% 79%
Dairy farmers 59% 59% 62%
Traditional farmers 45% 45% 51%
Street vendors 39% 35% 45%
Semi & skilled wage labourers 34% 32% 37%
Artisans & craftsmen 26% 22% 37%
Homebased
workers 25% 20% 38%
Agricultural wage labourers 14% 14% 12%
Other daily wage labourers 18% 15% 26%
Source: Invest India Incomes and Savings Survey, 2007 (IIISS07)
4 http://www.mit.gov.in/content/governmentapprovesframeworkprovisionbasicfinancialservicesthroughmobilephones
5 http://www.uidai.gov.in/documents/Exclusion_to_Inclusion_with_Micropayments.pdf
13. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 13
The Post Office Savings Bank (POSB) already is the largest bank in the country by
number of customers, and number of branches, handles a large volume of government
benefits payments, and does not distinguish between rich and poor customers. Thus, given
its size and reach, India Post can lead the way for financial inclusion. By doing so, it can
bring together a number of stakeholders on a common platform: central and state
governments, microfinance institutions, technology providers and most importantly, the
presently excluded individual citizens.
Commercial banks are leading the charge for financial inclusion today. They are opening
nofrills
accounts for poor customers. Central, state and local governments are increasingly
preferring government benefits payments to be routed through banks rather than using
moneyorders.
Banks are increasingly offering remittance products to their customers and
installing ATMs in rural areas. In a world that is fast becoming electronic and connected,
India Post needs to innovate and change with the times. It must offer customers products
that can be used effortlessly and instantaneously through the use of technology. By playing
a dominant role in financial inclusion, India Post can increase its relevance and improve its
profits.
Products that use cash implicitly pass on the costs of cash management to the customer.
This makes many of financial products infeasible. The costs of storage and transportation
of cash are very high. It is estimated that 1% of all microfinance loans go towards the cost
of cash management today. The poor often pay a large sum for safekeeping of money,
either directly, or indirectly through occasional theft. A savings account provides safety at
low cost, while at the same time bearing interest. Modernising the POSB accounts offering
with technology will form a basic building block of India Post’s offerings for financial
inclusion.
India Post also already offers a moneyorder
facility. While this product is expensive in its
present form, an electronic moneyorder
can become lowcost
and competitive.
Worldwide, post offices offer the Postal Giro as a means of sending payments
electronically, and a mechanism for paying utility bills. Once a payments system is set up,
India Post can deploy this infrastructure in elegant ways to become a market leader in
microloans
to the poor for emergencies. It will be able to offer much cheaper loans to its
customer by harnessing the power of technology and innovative product design.
14. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 14
This Expert Committee therefore recommends that India Post implements the following
three building blocks for financial inclusion:
1. A savings account solution,
2. A payments solution, and
3. A microcredit
solution.
2.1 Principles
Extensive use of technology is the only realistic way to achieve economies of scale and
deliver a range of financial services in a secure environment at a low cost to the poor. At
present, IT skills and capacity at India Post are relatively limited although the Department
is rapidly incorporating technology into its processes and acquiring new IT skills. It’s core
competencies are its outreach, credibility and brand strength among everyday Indians.
India Post should actively embrace the financial inclusion agenda and harness both
modern technology and innovations in distribution and outreach. In this process, it should
not displace private initiative. Instead, it should proceed in a spirit of publicprivate
partnership that harnesses the trust and outreach of India Post and the technology skills
and innovations of private technology and financial services firms to deliver the core
building blocks of financial inclusion to every citizen of India.
The Expert Committee's recommendations in this Report are therefore based on the
following guiding principles:
1. Focus on public goods: The government should largely focus on providing public
goods. Government investment should not displace private investment, but create
an environment conducive to private investment.
2. Publicprivate
partnership: The Government should undertake activities that are
difficult for the private sector to provide and simultaneously encourage a
competitive ecosystem, free of any vendor lockin,
and provide a level playing
field.
3. Incentive compatible solutions: A solution must be incentive compatible. All
participants should participate willingly, and based on selfinterest.
There must be
15. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 15
a positive gain for all participants: India post, customers, and private sector
partners.
4. Vendor neutrality: Any solution deployed by India Post must be vendor neutral
both in the technology acquisition phase, and in the selection of partners. Open
standards based solutions must be deployed, so that India Post cannot be held
hostage by any specific vendor in the future.
16. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 16
section three
SAVINGS ACCOUNTS
The post office savings bank (POSB) account is well placed to serve as the basic building
block of all financial inclusion activities that India Post undertakes. The system for issuing
and managing POSB accounts should however be modernized by implementing a
customised and scalable lightweight technology solution.
Commercial banks that host lightweight, nofrill
accounts on a traditional CBS find this an
expensive option as it involve high fixed costs for software licenses and hardware. For the
purposes of offering a limited set of welldefined
services to a very large base of
customers with modest savings capabilities, and in an environment with dynamic
transaction loads, India Post should aim to acquire a tailormade
technology solution that
can adapt itself to changing capacity forecasts and needs.
In this context, the Expert Committee recommends that India Post create a publicprivate
partnership through a competitive process under which a technology services vendor
builds and operates a hosted, lightweight CBS platform for India Post. The technology
solutions provider should be expected to establish capacity for delivering a range of
specified services based on its own estimate of transaction volumes and growth. India Post
should either pay a fixed annual fee per account and a modest fee per transaction or derive
a revenue share from the technology solutions provider on the basis of a charge that the IT
vendor believes the market will bear. The technology services vendor should be chosen
through an auction.
This model aligns the incentives of the IT vendor with those of India Post while ensuring
optimum software and hardware capacity and deployment. In parallel, this model mitigates
the technology risk for India Post, facilitates rapid deployment and does not impose
significant upfront
technology investment. This will free India Post to focus on its core
competencies of delivering banking services throughout the country, whereas the IT
vendor would focus on its core competency of running a large IT system. A classic
example is that of Airtel, where Airtel saved a significant sum of money by outsourcing
17. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 17
its IT and network operations. The IT management of NPS and TIN are examples of
government projects that have been successfully outsourced in a publicprivate
partnership
mode.
In its vision document for financial inclusion, the Unique Identification Authority of India
(UIDAI) has proposed a bank account for everyone in the country. The Thirteenth Finance
Commission has proposed a budget of Rs.3,000 crore to be used for delivering an
incentive of Rs.100 into the bank account of each BPL resident who enrols for a UID. This
creates a panIndia
demand for lightweight
bank accounts. India Post, with its ubiquitous
reach should actively position itself to offer a low cost lightweight bank account to anyone
enrolling for a UID. Simultaneously, India Post should accept a UID as a sufficient KYC
for opening a POSB account.
A streamlined POSB account that can be operated at any post office in the country, and
can be accessed through a mobile phone can have huge positive network externalities.
Several stakeholders will benefit: Customers will be able to access their accounts
ubiquitously; Financial firms providing credit, insurance, pension, and other innovative
financial products to the poor will have a lower barrier to entry, and lower operational
costs; Central and State governments will be able to deliver benefits and subsidies directly
into the accounts of target beneficiaries; and India Post will be able to further increase its
customer base and more effectively increase its footprint
in financial inclusion.
Additional revenue streams can be created by India Post by allowing other strategic
partners such as MFIs, insurance and mutual fund companies to use these lightweight
POSB accounts for delivering a range of financial services to citizens. This would in turn
lead to high transactional volumes and increased revenues for India Post.
The Report of the InterMinisterial
Group on the “Framework for Delivery of Basic
Financial Services using Mobile Phones” recommends the creation of a national
infrastructure Interoperable
Infrastructure for Accounting Small Transactions (INFAST).
It calls for all banks to create nofrills
accounts on a centrally hosted and managed IT
infrastructure to lower costs. This presents a unique strategic opportunity for India Post
and the Department should play a proactive, leadership role in creating INFAST. By
linking its proposed lightweight bank accounts to UIDs and by opening this platform to
other strategic partners, India Post can lead the charge in implementing INFAST and
effectively emerge as India's financial inclusion platform.
18. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 18
section four
PAYMENTS
The domestic moneyorder
(MO) is an India Post product that has huge brand value. India
Post has delivered on the promise behind this brand for over a century, and continues to do
so. A payment can be sent by a person to any other person in the country through an MO.
In the age of the internet, it would not be unreasonable for a customer to expect that MOs
be delivered within seconds into their postal savings accounts.
Towards this objective, the Expert Committee recommends that India Post establish a low
cost payments platform. A lowcost,
nationwide
payments platform will foster an
ecosystem that offers several propoor
financial and nonfinancial
products as all financial
products require a robust payments mechanism. A loan involves a payment to a customer
followed by periodic interest repayments by the customer over time. In insurance products,
premiums are paid periodically, with a possible payout in the future. A pension product
requires contributions over several years, followed by a pension payout at retirement.
Mutual funds require an upfront
payment to buy the product, with periodic dividend
payments to investors.
A payments system thus plays a major role in the delivery of financial products. A mass
market for propoor
financial products, and for financial inclusion, requires a reliable, lowcost,
lowvalue
payments platform that is available ubiquitously.
4.1 EuroGiro – A case study
EuroGiro, a payments system that originated in and continues to be run by post offices, is
a global network for electronic exchange of lowvalue
international remittances between
members. It is a gateway providing connectivity across several financial services alliance
members and partners in almost 50 countries. More importantly, it brings together post
offices and banks on a common interoperable network. It’s offerings include three classes
of products.
19. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 19
1. Account to account payments,
2. Cash sent as MOs – cash to cash payments, and account to cash payments, and
3. Bulk and pension payments
Eurogiro focuses largely on low value payments for corporate, retail and institutional
customers. It is able to achieve good economies of scale since it processes a large volume
of transactions by paying special attention to standardization and subcontracting
several
operations. India Post can certainly match and surpass the achievements of EuroGiro.
4.2 India Post Payments Network (IPPN)
India Post should aim to create the country’s first largescale
smallvalue
payments
network – the “India Post Payments Network” (IPPN) that is capable of electronic transfers
of Rs.100 at a charge of less than Re.1. The need for such a network, and an overview of its
design is put forth in the UIDAI's vision document – “From Exclusion to Inclusion with
Micropayments” as well as in the InterMinisterial
Group’s Report on “Framework for
Delivery of Basic Financial Services using Mobile Phones”.
Both Reports call for a tight integration between bank accounts and payments linked
through mobile phones. Thus a POSB account should be tightly integrated with the MO. A
customer must be able send and receive
payments into their accounts, or as cash,
through all channels – the post office, the
postman on the beat, mobile phone, internet,
or a franchised location.
One important distinction between payments
and other financial services is that they are
fundamentally different businesses. They
require different kinds of business planning
and focus. Most financial products are about
financial intermediation. Financial
intermediaries bring together lenders and
borrowers using a variety of financial
instruments that match the consumption and
Figure 1: Mobile transactions on the
India Post Payments Network
20. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 20
savings needs of both classes of agents. The organization needs proficiency in financial
tools such as building credit models, actuarial models, building networks of customers and
clients, risk management models, etc. Payments systems are fundamentally about building
efficient IT systems, building a platform, operating retail networks, and making sure that
all service providers gain a little something on each transaction. Thus, IPPN will require a
team that is tuned to the requirements of building a payments system rather than one that
is focused on delivering financial products.
This retaillike
nature of a payments system means that high volumes and ubiquity are
necessary for success. All possible markets must thus be tapped to build volumes. The
possibilities include but are not restricted to the following channels:
1. Persontoperson
payments
2. Government benefits payments
3. Microfinance,
microinsurance,
micropensions
4. Mobile prepaid topups
5. Recurring bill payments
6. Railway tickets
7. Other merchant transactions
Of the channels above, India Post should play an active role in the creation of the
electronic MO, linked to lightweight POSB accounts. This will enable persontoperson
payments, and G2P payments. For all other channels, India Post should nurture the
creation of an ecosystem, where other public and private enterprises integrate the India
Post Payments Network (IPPN) into their own businesses, along with creating innovative
payments products. For example, mobile operators will welcome the idea of providing
their customers an ability to topup
their mobile accounts through their phones, and the
ability to send mobile payments to others through the IPPN. Similarly, Indian Railways
will be able to use this network to expand its ticketing system to franchised agents. MFIs
will be able to bring down their operations costs when they no longer have to manage cash.
A variety of businesses will develop solutions and target all sections of the Indian
population. India Post can thus nurture innovation, without taking any business risks itself,
and instead charge a transaction fee for every transaction that its platform processes.
As India Post already operates a massscale
MO network in the country, it already has
much of the cash management infrastructure in place to take payments to the next level.
21. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 21
India Post also already works with several other public and private enterprises, and
successfully operates a number of rural post offices through a franchisee model. Thus,
ecosystem creation is not a new concept for India Post. With IPPN, India Post can nurture
this ecosystem on a much larger scale, with much bigger impact.
To make this work, India Post will need a modern, electronic savings account, and a
modern electronic payments network. Banks already offer an electronic savings account
without a ubiquitous lowcost
lowvalue
payments solution. An electronic payments
network is also offered by a variety of payments processors. By themselves, neither
solution has had a significant impact on financial inclusion. A lowcost
combination of the
two products however, can be an important stepping stone to meaningful financial
inclusion. This point is emphatically made in the report “A hundred small steps, Report of
the Committee on Financial Sector Reforms”, chaired by Prof. Raghuram Rajan.
4.3 Technology
The Expert Committee recommends implementing the UIDenabled
micropayments
solution as described in the UIDAI vision document “From Exclusion to Inclusion with
Micropayments”, and the Report of the InterMinisterial
Group on a “Framework for
Delivery of Banking Services Via Mobiles”. The technology must use open standards, and
architectures to the extent possible. India Post will need to put in place the following three
essential pieces of infrastructure:
1. A lowcost
repository of accounts (INFAST in the IMG report)
2. A payments interface among these accounts (G2P and P2P)
3. PoS (Pointofsale)
devices operated by postoffices,
postmen, and merchants
(MicroATMs in IMG and UIDAI reports)
Each of these pieces of infrastructure will be required for the POSB accounts and the MO.
However, all of this infrastructure should also be exposed as software interfaces for
partners to create accounts, process payments, and withdraw cash at frontends. It is
recommended that the infrastructure must be light and efficient, so that it can be deployed
on mobile networks, and must not require high bandwidth internet access. An example of a
mobilebased
transaction initiated by a customer is shown in Figure 1.
The Expert Committee stresses the importance of building a payments platform and
22. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 22
cultivating an ecosystem around that platform. We draw an analogy with the Google Maps
platform. Google provides maps on its own websites, but allows others to also customize
and integrate maps in their own websites. Thus, a number of websites have integrated their
own data with maps provided by Google to offer customers a superior experience. These
websites do not have the capability to create a product like Google Maps on their own.
However, once Google provides this service, customers create unique new services that not
even Google could have imagined. Everyone benefits: Google Maps gains a number of
users that otherwise would not have used their service, while the websites incorporating
Google Maps gain more customers. The sum of parts here is greater than the whole.
Open access to India Post’s payments platform for partners can create large positive
network externalities by increasing the number of customers, driving volumes, and
bringing costs down for everyone.
23. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 23
section five
MICRO LOANS
Agricultural laborers, subsistence
farmers and other marginal primary
producers in rural India account for
around 60 percent of all debtors,
with an additional third or so of
debtors being own account workers
involved in nonagricultural
activities. Medical and financial
emergencies were the main reason
for household borrowing accounting
for 42 percent of all loans made in
the past two years. For the lowest
income quartile population, the incidence of emergency loans was highest at almost 50
percent, with the top three loan sources being moneylenders, friends/ relatives and SHGs.
Nearly half these loans carry an interest rate of above 36 percent per annum. Loans taken
for emergency purposes created an unsustainable amount of debt for the lowest income
segment with outstanding debts out of emergency loans resulting in debt on average
exceeding a full year’s earnings.
IIISS07 data show that there are other considerations (apart from the interest payable) in
the minds of borrowers that can drive a borrower towards one lender rather than another.
The attitudes of formal sector lenders are often seen as a root cause of low income workers
being driven into the arms of less affordable informal credit providers. In addition, the
formalities of the loans process followed by formal lenders and the time taken to issue loan
approvals obviously are seen by borrowers as deterrents to using formal loan channels –
especially for emergency loans. According to the Report of the Committee on Financial
Sector Reforms (CFSR) established by the Planning Commission, over 70% of loans taken
by those in the lowest income quartile in India are from informal sources – moneylenders,
24. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 24
relatives and friends. Other sources support the CFSR's conclusion that large segments of
India’s poor households continue to be shut out of formal credit mechanisms. Table 2
provides sources of loans by income groups.
The Expert Committee believes there is a large latent demand for consumption and
emergency loans. Thus a simple product – a Rs.500 loan with repayment at the end of the
month, if available ubiquitously, may have a huge impact.
Table 2: Sources of Loan by Income Group
Loan sources
Percentage of persons in income quartile
who have taken loan from these sources in the last 2 years
Lowest income
quartile
Second income
quartile
Third income
quartile
Highest income
quartile
Relatives / friends 39.2 34.4 33.2 32.0
Moneylenders 39.8 33.2 25.8 14.8
Banks 9.6 20.7 33.3 45.8
Self help groups 9.7 8.4 3.3 3.4
Cooperative
societies 5.4 4.9 6.5 7.4
Chit funds / NBFC 1.6 1.9 1.5 1.2
Microfinance Institutions 1.1 1.4 1.2 0.9
Others 1.0 0.9 0.8 1.4
Source: Committee on Financial Sector Reforms (Invest India Incomes and Savings Survey 2007)
5.1 Principles
The Expert Committee recommends that India Post establish a mechanism through which
the post offices can be harnessed into delivering shortduration,
fixedsize,
noncollateralised
micro loans (of Rs.500 for one month) while adhering to the following
principles:
1. India Post must not undertake credit risk using public funds,
2. India Post should serve as a facilitator for a massmarket
for microloans
without
running the market,
3. India Post must not displace private investment,
4. Vendor neutrality and transparency must be maintained in selecting eligible credit
providers, and
5. India Post should not perform any activities that may damage its reputation.
25. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 25
5.2 Mechanism for Micro Loans through India Post
A process of extending instant credit to a
customer is described in Figure 3. The role
that India Post should play in the space of
microloans
is that of an enabler and a
facilitator. Only one simple product should be
offered – a Rs.500 individual, unsecured loan
with a maturity of one month. Under the
proposed framework, a person wanting a loan
will provide his postal savings bank account
information and identification (UID) to India
Post through a post office (or a microATM
at
a postal branch).
The India Post staff (or ATM) will relay the
information to the India Post data centre
which will run an auction for the loan in realtime.
Preauthorized
credit providers will bid
for the loan on the basis of an interest rate and
the information on the customer. The lowest
Figure 3: Unsecured microloan
delivered by India Post to a customer
interest rate produced through this auction will be extended to the customer. The customer
will receive the loan through an MO, and will pay it back using an MO. The credit
provider will pay India Post a fee for processing the loan, and a fee for the moneyorders.
Should a person want a larger loan, he may apply for multiple Rs.500 loans, and the firms
that are bidding in the backend will make the decision on approving additional loans,
based on the credit profile of the customer.
5.3 Comparative Advantage
India Post is in a unique position to offer the above mentioned auctionbased
microloan
product for the following reasons:
1. The countrywide
network of over 155,000 post offices minimizes geographical
risk for lenders, as the defaults among borrowers will be uncorrelated,
except for
26. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 26
the business cycle.
2. With an existing cash management process, and given its scale and volume, India
Post can process cash and noncash
payments at much lower costs than any other
public or private institution. It can also facilitate both loan disbursement and
recovery.
3. It can enable credit scoring, based on each customer’s savings account information,
and knowledge of a customer’s other assets with India Post.
4. When the credit risk is mitigated or reduced using good quality credit information
linked to UIDs, India Post can harness existing credit capacity and competition to
further drive down the cost of consumption credit.
5.4 Implementation of MicroLoans
The following must be considered while implementing the proposed auctionbased
microloan
product:
1. India Post should use the UIDAI’s authentication mechanisms for identifying a
person.
2. Any regulated credit provider with sufficient capital must be allowed to participate
in the auction. Eligibility rules must be transparent and welldefined.
3. India Post must never release individual customer data to anyone. Instead,
institutions participating in the auction should upload their credit scoring and
decision making models to the India Post data centre. These programs must
process the information and arrive at a decision, with no human intervention.
4. By applying for a microloan,
the customer would authorize India Post to release
his information to the credit models running at the India Post data centre.
5. When a loan request is received, India Post would release the customer’s credit
history to the credit models of the participating credit providers, who will process
this data and post their best interest rate within 60 seconds.
27. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 27
6. The originator of the loan should be allowed to sell the loan to another institution,
provided that the owner of the loan is always on file with India Post. India Post
may charge a small fee for updating ownership records.
28. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 28
section six
IMPLEMENTATION RELATED ISSUES
6.1. Scope of POSB Role and Functions
The Post Office Savings Bank is included in the Union List vide item No. 39 of the
Seventh Schedule of the Constitution of India. It operates under various frameworks
defined by the Government Savings Bank Act, 1873, Government Savings Certificates Act,
1959, Public Provident Fund Act, 1968. Small savings schemes were designed to provide
safe and attractive investment options to the public and at the same time to mobilise
resources for financing public debt. India Post performs this function as an agent of the
Ministry of Finance, and is funded by the Ministry of Finance for doing so.
The environment under which the POSB was set up and operated in several decades ago is
quite different from the present policy and business environment. Thus, given the
challenges of inclusive growth and financial inclusion, the role of India Post must be
reviewed from first principles. As per the current Allocation of Business Rules, the
Government Savings Banks Act, 1873 is housed within the Ministry of Finance. India Post
should engage with the Ministry of Finance to reexamine
and expand its presently limited
agency function to enable the postal network to more serve effectively as India's financial
inclusion platform. This may require a significant change and expansion in the Allocation
of Business Rules for India Post. Specific recommendations in this regard are beyond the
scope this Expert Committee.
6.2 AML / CFT Compliance
India Post is a regulated entity under the Prevention of Money Laundering Act. The
underlying provisions related to customer due diligence, recordkeeping and reporting, as
well as the requirements of Anti Money Laundering (AML) and Countering Finance of
Terrorism (CFT) are mandatorily applicable to POSB balances and domestic remittances.
While implementing the above recommendations, and especially when India Post enables
29. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 29
private and public sector organisations to use its platforms for savings accounts, payments
and delivery of financial products, the relevant AML and CFT provisions mandated from
time to time by the Government of India, and applicable to India Post, should be
mandatorily applicable to such partners also. The relevant provisions in this context should
accordingly be included in all contracts between India Post and its partners.
30. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 30
section seven
SUMMARY RECOMMENDATIONS
Recommendation 1: India Post should deliver lightweight, lowcost
bank accounts to all
Indian citizens and especially to the financially excluded population.
Recommendation 2: India Post should look for ways to leverage its low cost platform by
providing India Post branded accounts to other strategic partners, such as MFIs, mutual
fund and insurance companies, and telecom operators.
Recommendation 3: India Post should apply itself towards the challenge of achieving
high volumes of moneyorders
where payments of as little as Rs.10 are achieved at a
charge of less than Rs.0.1 while requiring no subsidy from the exchequer.
Recommendation 4: India Post should evolve the moneyorder
to become a mechanism
for transferring money from one POSB account to another, instead of just being a
mechanism for delivering cash from one person to another.
Recommendation 5: India Post must build a payments infrastructure, through an array of
contracts with partners, connecting up all POSB accounts and accounts of its partners, to
effectively become a persontoperson
moneyorder
capability (through mobile phones or
web browsers) for a large swathe of India.
Recommendation 6: India Post must elicit a large number of partners in terms of
financial inclusion players, mobile service providers and innovative new technological
choices in order to increase the size of the network.
Recommendation 7: India Post must work closely with a diverse array of government
agencies so that their G2P payments requirements are met through a combination of
POSB accounts held by citizens and moneyorders
delivered by government to those POSB
accounts. The Ministry of Finance must work with India Post in rapidly rolling out this
platform and network, given its important implications for direct, targeted delivery of
31. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 31
government subsidies.
Recommendation 8: India Post should play a role in the emergency credit aspect of
financial inclusion, through a platformbuilding
approach where private lenders deliver
credit to the poor through a competitive framework.
Recommendation 9: India Post should request the addition of its financial inclusion
project into the Terms of Reference of the recently announced Technology Advisory Group
for Unique Projects, and the leadership team of the India Post financial inclusion project
should closely engage in the work of this Group, so as to bring in the best practices for
project management.
Recommendation 10: The role of the Post Office Savings Bank as an agent of the
Ministry of Finance should be revisited and expanded to enable India Post to play a
larger, direct role in financial inclusion and build appropriate enabling architecture.
32. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 32
section eight
CONCLUSION
India Post is the largest and most credible outreach infrastructure in the country. It has
several decades of experience in delivering bank accounts and payments across the
country and especially to the poor. India Post is already in the process of reinventing itself
and has implemented several innovative products for its letter and package delivery
business. However, while India Post has also introduced new financial products, its own
basic banking and moneyorder
products have remained unchanged for several decades.
A combination of the India Post outreach and credibility, with its extensive experience
with delivering savings accounts and payments on a panIndia
basis can serve as a critical
building block for broadbased
financial inclusion. This Report recommends that India
Post harnesses the rapid IT and telecom capacity expansion to deliver three basic,
integrated products to every Indian citizen: a savings account hosted on a lightweight
banking platform, a broadbased
payments network, and a competitive mechanism to
deliver microloans
to the poor.
In this process, India Post would create essential public goods in the form of low cost
banking and payments capacity that reaches every Indian citizen. In parallel, India Post
should aim to build an ecosystem where several public and private sector partners can
design and deliver new innovative products using its low cost banking and payments
infrastructure. In this way, India Post would drive innovation in financial inclusion and
increase its own revenues without assuming significant technology or credit risk.
A well functioning publicprivatepartnership
model provides a sound business case for
India Post. For the Government of India and the Ministry of Finance, this squarely
addresses the core policy goals of financial inclusion. For the public at large, and
especially for the poor, this will be an critical window to a range of sophisticated and
affordable financial products and risk management tools.
33. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 33
annexure
EXPERT COMMITTEE MEMBERS
Dr. Ajay Shah (Chairman)
Senior Fellow
National Institute of Public Finance and Policy
ajayshah@mayin.org
Ashok Pal Singh
Deputy Director General
Unique Identification Authority of India (UIDAI)
ap.singh@nic.in
Sukriti Likhi
Director, Department of Financial Services
Ministry of Finance, Government of India
sukriti.l@nic.in
Manisha Sinha
Director (Financial Services)
Department of Posts
manishasinha@indiapost.gov.in
Vijay Mahajan
Chairman, BASIX
vijaymahajan@basixindia.com
Dr. Kshama Fernandes
Chief Risk Officer, IFMR Capital
kshama.fernandes@ifmr.co.in
Gautam Bhardwaj (MemberSecretary)
Managing Director
Invest India Economic Foundation (IIEF)
gautam@iief.com
Dr. K.P. Krishnan
Joint Secretary (Capital Markets)
Department of Economic Affairs
Ministry of Finance, Government of India
kpkrishnan@nic.in
A.S. Prasad
Deputy Director General (Financial Services)
Department of Posts
ddgfs@indiapost.gov.in
Dr. Shashank Saksena
Director, Department of Financial Services
Ministry of Finance, Government of India
ssaksena@nic.in
Dr. Viral Shah
Unique Identification Authority of India
viral@mayin.org
Ramesh Ramanathan
Chairman, Janalakshmi Financial Services
ramesh.ramanathan@janalakshmi.com
Ashish Aggarwal
CEO, Invest India Micro Pension Services
ashish.a@iimp.in
34. Expert Committee Report: Harnessing the India Post Network for Financial Inclusion 34
TECHNICAL EXPERTS
S. Samant
Member, Postal Services Board
Department of Posts, Government of India
ssamant@indiapost.gov.in
T.V. Seshadri
Vice President and Country General Manager
South Asia, MasterCard Worldwide
tv_seshadri@mastercard.com
Sushant Kumar
General Manager and Country Head
Financial Institutions, Capital Markets and
Government Banking Group, ICICI Bank
sushant.kumar@icicibank.com
Sanjeev Kapoor
Head, Government and Telecom Sectors
Infosys Technologies
gautam_b@infosys.com
Anil Misquith
General Manager (Enterprise Group)
Intel Technology India
anil.misquith@intel.com
Karan Bajwa
Country Head – Public Sector
Microsoft Corporation (India)
karanba@microsoft.com
Sudeep Yadav
Managing Director, Business Development Head,
Treasury and Trade Solutions, Asia Citibank N.A.
sudeep.yadav@citi.com