Reserve Bank of India is in the process of strengthening the network of banking correspondents by creating a registry, Governor Raghuram Rajan said here today.
"We are engaged in strengthening the network of banking correspondents by creating a registry of banking correspondents, giving them the ability to take and give cash on behalf of any bank through the Aadhaar Enabled Payment System which will also give them adequate remuneration, and requiring that they are adequately trained in providing financial services.
"Cash-in-cash-out points will expand soon as the Postal Payment Bank and telecom affiliated payment banks make post offices and telephone kiosks entry points into the financial system," Rajan said at a seminar at the National Institute of Rural Development and Panchayati Raj.
Transfers from bank account to bank account will become easier via mobile through the Unified Payment Interface which is going to be launched shortly, the RBI Governor said.
RBI has created a new institution called 'small finance bank', where "small" refers to the kind of customer the bank deals with, not its size. With 75 per cent of the loans mandated to be below Rs 25 lakhs, the small finance bank is intended to provide services to the excluded, he said.
"Thus far, the licences have been largely given to micro-finance institutions and one local area bank, but there is no reason why these cannot be given to regional rural banks and co-operatives in the future. The hope is that these institutions will maintain a low-cost structure, augmented by technology, to provide a menu of financial services to the excluded," he said.
"Going forward, by the end of the year, the Credit Information Bureau of India will start providing individuals with one free credit report a year, so that they can check their credit rating and petition if they see possible discrepancies," Rajan said.
An important proposal of the government is to give small businesses "Udyog Aadhaar" numbers, which are unique IDs tied to both the entity as well as the promoter. Such IDs could allow small firms to build credit histories with credit bureaus, especially as the histories are tied to specific promoters, he said.
