Banks in India need to reach out to their potential customers in the rural areas by leveraging emerging technologies in banking and adopting the Business Correspondent model to deepen the process of financial inclusion in the country.
Besides, the banks have to seize the initiative in making the people, especially those living in the rural areas, aware of the technological advances in banking and its implications.
This was pointed out by experts at a Banking Conclave on Emerging Trends in Banking Sector: Challenges and Responses organized here by the Institute for Management and Information Science (IMIS).
“We need to reach out to the people in the rural areas and this can be done through banking correspondents as it is not viable for the banks to set up branches in all villages of the country. Moreover, the banks can also tap emerging technologies for reaching out to the rural masses”, said Shiv Kumar, chief general manager of State Bank of India (Bhubaneswar circle).
Himanshu Shekhar, vice-president, Axis Bank said, “The customers, particularly those in the rural areas need to be updated on the technological advances in banking and its implications. The bank employees have to take the initiative in this connection.”
Kirpal Singh, general manager, Small Industries Development Bank of India (SIDBI) said, “The banks should focus on expanding their rural outreach both in terms of opening of new accounts and lending to the small units as well as the upcoming entrepreneurs. SIDBI was the pioneer in lending to the micro-finance institutions and later the different commercial banks followed suit.”
He pointed out that SIDBI had kicked off the Rural Industrial Programme this year in 50 districts across the country.
The bank spends Rs 20 crore every year on this programme which involves the identification and training of entrepreneurs, he informed.
KC Padhy, director, IMIS said around 40 per cent of the country's population is yet to be covered under financial inclusion and this offers a huge potential for the banks to tap the savings of the rural customers.
On the impact of the global financial meltdown on the operations of the Indian banks, the experts said the banks in the country have not been impacted by the financial turmoil because of their sound banking practices.
