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1. Services in Rural Market

2. Services Sector in India
• Largest and fastest growing sector at 11%.
• Contributes 57% of the GDP and employs 34% of the
work-force
• 60% of the country’s 16.5 million enterprises are in rural
India
• Rural services sector comprises mainly of retail trading,
transportation and communication, financial services,
healthcare, housing and construction, education and
community and social services

3. Telecommunications in Rural India
• 383 million subscribers as of June 2014
• Grew over six times in five years
Rural Subscriber Growth

4. Telecommunications in Rural India
• Catalysts for growth:
 Relevant and attractive schemes like:
 Free lifetime validity of SIM card
 INR 5 recharge vouchers
 Coupling of cheapest handsets with cheapest call rates
 Infrastructure sharing
 Content in vernacular language

5. Telecommunications in Rural India
• There are 68 million internet users in 2013 compared to 7.5
million users in 2009 in rural India
• Rural markets have reached the user base of 383 million by
june 2014
• Cellular companies tying up with various players to provide
rural-specific, real-time, customized informational services
on mandi prices, weather and other services

6. Telecommunications in Rural India
• In mobile telephony, Bharti is the market leader with a 24% share
Rural Subscribers and Market Share

7. VAS Providers in Rural India
• Started in Maharashtra in April 2007
• Covers half a million farmers in Punjab,
Himachal Pradesh, Haryana and Maharashtra
• Partnered with Idea Cellular to increase reach
Reuters Market
Light
• Joint venture between Airtel and IFFCO
• Launched in 2007 in eastern U.P.
• 30 million farmers and 39,000 cooperatives as
of December 2010
IFFCO Kisaan
Sanchar Ltd.
• Launched in Maharashtra in 2008
• Tie up with Reuters Market Light and Tata
Docomo
• Covers 18 states in 11 regional languages
Nokia life tools

8. ICT in Rural India
• Absence of reliable physical delivery systems have led to
growth of information and communication technology in
rural India
• Rural ICT kiosks and rural BPOs initiated by both
government and private players

9. ICT in Rural India
• More than 65,00 ICT kiosks led by government sponsored common
service centres (CSCs)
Major ICT initiatives in Rural India

10. ITC’s e-Choupal
• Initiated by ITC’s agribusiness division in 2000 aimed at direct
procurement channel
• Hub and spoke model with ITC procurement centre as the hub
and e-Choupals as the spokes
• Covers four million farmers spread over 40,000 villages through
6,500 e-Choupals
• 4% to 7% reduction in true cost of contract
• Version 3.0 to be rolled out by 2012 in collaboration with Nokia
Life Tools to provide additional reach of 16 million farmers

11. Common Service Centres
• A public–private partnership to integrate commercial and
social goals through combination of IT and non-IT services
• Follows a three-tier hierarchy:
 Village Level Entrepreneurs covering five to six villages
 Service Centre Agencies for training, managing and expanding the
business of VLEs
 State designed agencies for implementation of the scheme
• Plan for one CSC for six census villages catering to 6,000
citizens
• Presently covers 13 states through nearly 56,000 CSCs

12. Financial Services in Rural India
• 78% households save in rural
• Average annual household saving
INR 22,960 in 2010.
• 85% save in cash; 25% in gold
• Among formal channels, bank
deposits, insurance and postal
savings are most preferred
• Critical needs in rural are:
 Micro-savings
 Frequent withdrawals
Branches
Commercial and regional banks 37,953
Micro-finance institutions 46,000
Cooperative institutions 96,000
Post offices 135,000

13. Banking Services in Rural India
• Moneylenders main providers of financial services
• 185 million “potentially bankable” households
• Only 7% villages have banks
• Non-branch initiatives include mobile ATMs, smart cards and mobile
banking
• Use of SHGs, MFIs, post offices and business
correspondent/facilitators model
• Focus on no-frills accounts, simple-to-use cash dispensing and
collecting machines
• Credit plus services for rural training

14. Microfinance and Credit Services
• Customer needs for consumption, healthcare, education and
emergencies
• Dependence on informal sources down from 90% in 50s to 40%
now
• Major credit instruments in rural are:
 MFI loans
 SHG–Bank linkage model
 MFI–Bank linkage model

15. Microfinance and Credit Services
Kisan credit cards introduced in 1998–99
96 million cards as of August 2010
Up to 20% of limit can be used for purchase of non-agricultural products
Chit funds, especially in South India

16. Insurance in Rural India
• Life insurance
One public sector and 23 private sector players
LIC market leader with 71% share
Private players have met objective of 25% policies for rural in 2009-
10
73% of rural households aware and 19% policy owners (Max–NCAER
survey 2005–06)
Penetration expected to cross 35%-42% by 2012 (McKinsey Global
Institute)

17. Insurance in Rural India
• Non-life insurance
Seven public sector and 21 private sector players
• Distribution of products in rural markets largely through agents, MFIs, banks
and consumer goods companies
• Micro-insurance introduced in 2005 growing dramatically

18. Rural Healthcare Services
• Rural health spending expected to grow from INR 700
billion in 2005 to 3,494 billion in 2025
• Share of wallet expected to go up from 7% to 13% in
same period
• Major challenges are inadequate physical infrastructure
and an acute shortage of skilled manpower

19. Rural Healthcare Infrastructure
• Staffed by doctors, paramedics and nurses
• Catchment area 120,000 population
Community health
centres (4,276)
• Staffed by doctors, paramedics and nurses
• Catchment area 30,000 population
Primary health centres
(23,458)
• Staffed by health workers and nurses
• Catchment area 5,000 population
Sub-centres (146,036)
•Accredited Social Health Activist (ASHA)
•Jan Swasth Rakshak
•Dais
Local actors

20. Rural Healthcare Market
• Estimated at INR 1.1 trillion in 2005; expected to grow to
INR 8.9 trillion by 2025
• Medical services and pharmaceuticals account for nearly
75% with medical equipment contributing the balance

21. Rural Healthcare Market
• Compounded Annual Growth Rate:
Medical services 15%
Pharmaceuticals 4.7%
Medical equipment 6.6%
The Healthcare Market

22. Government Initiatives in Rural India
The National
Rural Health
Mission
Integrated
Child
Development
Scheme
Janani
Suraksha
Yojna
Rashtriya
Swasthya
Bima Yojna

23. Growth Drivers of Rural Healthcare
Telemedicine
• Remote delivery of
healthcare services
through
telecommunications
technology
• Size $ 3.4 million in
2007. CAGR of 21.6%
to 2014
• Major players Apollo
Telemedicine Network
, Aravind Eye Hospital,
Narayan Hrudayalaya,
The Asian Heart
Institue and ISRO
Growth of health
insurance
• Covering 20 million
families across
27states
• Some initiatives –
Yeshasvini in
Karnataka and
Aryogya Raksha in
Andhra Pradesh
Public Private
Partnerships
• Address inefficiency
and inequity in health
system
• Accelerated delivery
with customer focus

24. Highest growth sector
Rural Services Sector