What is the longest distance you traveled to avail a service? Okay, I am not talking about marathons!
But while you are reading this on your smart device waiting for a booked cab or live cricket score, pause as many individuals across the globe do not have access to formal banking system within 5 km radius. Would you walk to your bank to get cash or make a fund transfer? Sounds like a problem!
A days wage in urban cities
Imagine your housemaid or daily worker at a construction site, can they skip a day’s work to go to the bank and open an account? It would cost them a day’s wage that lights up his home. Yeah, you can argue that they carry a mobile phone, what is stopping them from accessing banking services?
But as simple as it sounds, opening a bank account is not easy for them with no proper address proof or valid documents for KYC. Even if with government schemes like Pradhan Mantri Jan Dhan Yojna [PMJDY] they might be the proud owner of an account, but majority of this set do not use them for savings, to receive pays, to pay bills, or to avail loan as going to a bank, depositing the money is again cutting a day’s wages.
What Needs to be Done
Awareness in rural places
Individual staying in rural areas across the globe face crunch when they need loan [for farming or kids’ education or setting up a small scale industry] but lack of bank branches make it real trouble. Then comes the business minded “middlemen” who provide loans at such a higher rate that leads to a lifetime indebtment to an individual.
Many people in rural places are also not aware that a savings bank account can help them earn some interest, so better to keep the money in the bank than in a locker at home.
Lastly, the lack of knowledge that banking could be availed via a simple phone owned by them is just the root cause of not availing banking services.
What Needs to be Done
While technology has a part to play in the digital revolution, its the individuals and banks who need to participate and go with the flow. If you are a Bank looking to adopt or expand the digital services we are here for you.
Teknospire a fintech firm offers Bank-in-a-box solution with omnichannel, agent/digital branches capability. The 360-degree banking solution reduces the CAPEX for a bank to set up a physical branch, but yet opens doors to expand their business. Our Digital Banking, Mobile Banking, and Agent Banking solution could help regional banks and cooperative banks to push Financial Inclusion further. For details, please contact us here
Watch out this space to get more insights on Last Mile Banking or Financial Inclusion.