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Leveraging ICT for social Inclusion
Dr. Nachiket Mor
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Banking in remote rural India
• Rural customers have different financial needs– Low value – Frequent transactions
• Need to customise current model to take care of: – Several proximate touch points– Unreliable connectivity at last mile– Investment in local human resource– High monitoring for some portfolios
• Unique transactional environment– Local language interface for customers– No systematic way to record credit history– Challenge to provide KYC documents
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Financial Planning – Life Wealth Envelope
• Developed as a training tool and draws parallels from a flight simulator
• Simulates 100 possible wealth paths of a household and picks the best and the worst possible pathways
• Attempt is to push the lower-bound line upwards using financial products
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Pilot landing on Hudson saving lives
•Setting the context right
•Training/simulations prepare you for real life challenges infact save lives
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Low Income Wealth Envelope
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Kshetriya Gramin Financial Services
• To provide financial services to underserved rural areas
• Financial services offered are:– Loans– Insurance– Money market mutual fund– Remittances
• Each KGFS to operate in two districts or cover 5 mn population
• Ownership for maximising the financial wellbeing of the clients
• Thin level branch at village level• Strong back office with technology
infrastructure
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Key applications of technology
• Customer unique identification– To record credit history– Enables dedupe process
• Profiling and continuous updation of customer household data– To build scoring models– To develop new products– To understand the impact of usage
• Equip frontline staff to do financial planning• Enhance collateral management• Building systems to scale
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Customer Unique Identification
• Capturing Fingerprint Biometric for authentication
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Profiling and continuous updation of data
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Enhance collateral management
• Using RFIDs to identify cattle for Insurance
• Cattle health details capturing through Veterinary application
• Reduction in premium on account of reduced moral hazard
• Technology to track the movement of collateral like Trucks / LCVs
• Reduction in LGDs through enhanced monitoring
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Building systems to scale
• Flexcube- core banking system
• Cost effective ASP Model• Secured and state of the art data center• Multiple fallback/ DR site• Access over internet/intranet
• Customer Management System
• Offline/online mode of operation• Modular approach to add product functionality• Multiple entities support• Access over internet
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Areas for partnership
• Optimal way of using biometric to identify customers
• Low cost computing and data entry devices
• Connectivity in remote rural areas/ mountainous region
• Low cost structures for cash management services
• Mobile phones as an interface for financial services
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Thank You