Page 51 - Banking Finance July 2022

FEATURE

SIGNIFICANT

HURDLES IN MAKING

FULL RANGE OF

FINANCIAL SERVICES

AVAILABLE TO ALL

espite making rapid strides in digital transactions Some of the key highlights and recommendations of the
D and expansion of universal banking services to report include easier cash in cash out (CICO) access by
the last mile, there are still significant hurdles
allowing individuals like kirana store owners, tradesmen etc
in making the full range of financial services
to function as business correspondents (BCs) to reach the
available to all sections of the population, especially those
end customer. It also suggested reevaluation of banking
in low income groups and senior citizens.
charges for digital transactions like exceeding the free
That’s according to a report ‘Financial Inclusion Challenges’ number of transaction limit, insufficient balance, ECS
released by IIT Madras Research Park (IITMRP) and IITM bounce, SMS updates etc.
Incubation Cell. The report, released on Tuesday, was aimed
The report highlighted that know your customer (KYC)
at highlighting the gaps in financial inclusion despite the
process and need for PAN, OTP or biometric verification
transformation in the financial services sector over the last
have made it cumbersome for low-income groups and called
decade.
for replacement of in-person KYC and (live-video KYC) to be
Significant transformation replaced by non-live (non-human) option with encrypted
The report said over the last decade, financial services in liveliness checks built in.
India had undergone significant transformation driven by
The report was launched by Gopal Srinivasan, CMD, TVS
technology enablers and supported by the government and
Capital Funds; S Mahalingam, Ex-CFO, Tata Consultancy
regulators such as RBI. While Jan-Dhan Yojana has increased
Services; Prof V Kamakoti, Director, IIT Madras, along with
the banking penetration with over 44.5 crore new accounts
Jhunjhunwala.
created since 2015, the Unified Payments Interface (UPI)
had a meteoric rise in adoption with monthly transaction Speaking after the report launch, Srinivasan said India has
value jumping from ?0.38 crore in July 2016 to ?8.27-lakh the largest pubic digital infrastructure starting with Jan
crore in February 2022. Dhan Yojana, Aadhaar and Mobile number (JAM), UPI, Goods
and Services Tax (GST), e-Pass, FASTags and Open Network
However, the report added that ‘financially excluded groups’
for Digital Commerce (ONDC).
including low-income groups and elderly, have faced
challenges in accessing the full range of products and “But, it is really stunning to note that Rs. 60 is charged for
services from formal financial services. a Rs. 100 deposit, Rs. 150 is charged for the fifth ATM
“Despite our achievements in financial services sector, a transaction and Rs. 23.60 for an attempted ATM withdrawal
large section of the Indian society is still struggling with etc,” Srinivasan said highlighting some of the report findings.
fundamental financial inequities,” Prof Ashok Jhunjhunwala, In his address, Mahalingam said India is really in a position
President, IIT Madras Research Park, IITM Incubation Cell to take major leadership in infusing technology in the areas
and IITM’s Rural Technology and Business Incubator (RTBI). of financial inclusion. (Source: Business Line)

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