BUSINESS CORRESPONDENT MODEL- UNDER FINANCIAL INCLUSION, ISSUES & STRATEGIES FOR MAKING ITA SUCCESS

Financial inclusion is a process of providing access to appropriate banking and financial products and services to the vulnerable groups in particular such as weaker sections, low income groups at an affordable cost.

- NV Gupta

Introduction:

In simple terms bringing vast sections of society who were excluded from availing banking services in to the folds of formal banking.

In business angle, it is tapping of untapped business opportunities in way of creation of a strong base and foundation for good volume of low cost deposits for the bank in the long run. From peoples point of view getting a banking facility is costly, hence if such service available at an affordable cost and available at the suitable location most of the people will start doing banking.

It is an obligation from RBI also to implement Fl in the country either by establishing brick and mortar branches or in any other way, but the service must reach.

So in this paper, an attempt made to discuss different issues faced by banks while scaling up the BC model and strategies for making it a success.

Let us discuss:

During 2008, based on the recommendations of Rangarajan committee RBI has advised banks to establish a road map for implementation of Fl, either by establishing brick and mortar branches or BC/Kiosk points in villages with populations>2000, <2000, over a period of time.

The focus of financial inclusion is to ensure coverage of each household in the country under the banking umbrella by providing banking services such as