Students, including those from India, at a prestigious university in the US have developed a smart phone-based app which can bring an ATM to every pocket in rural India and has the potential to channel USD 4.7 trillion in purchasing power through digital medium.
Developed by the Graduate student Spriha Bhandari, who is originally from India, and a group of other students from the Cornell University, the app called "Pocket Change" is a chat bot that enables peer to peer transfer of cash to digital.
Bhandari, 18, said the app has been developed as part of the Bill and Milinda Gates Foundation to look into ways towards financial inclusion in the emerging markets wherein people are living on less than USD 2 a day and are basically on a cash-based economy.
"The problem statement posed to us by the Bill & Melinda Gates Foundation was how can we ensure people in rural areas in emerging economies, living on less than USD 2 a day, have an easy, affordable and trusted way to convert their cash into digital and back," Bhandari told PTI.
"Over the course of the semester, we came up with our final product. For this we used Google Vision to take pictures of the physical cash for the transfer," she said.
Other members of the team include Arpit Sheth, Jamie Yu,Jonathan Cutler and Zachary Silverstein.
"We first had an app that encouraged digital loans, but we realised that we couldnt just leapfrog to a fully digital solution, so we pivoted and made pocket change cash friendly product that builds out the missing infrastructure needed to encourage a digital economy," said Jamie.
The impact of the app can be massive, she said, adding that imagine 850 million people living in rural India becoming the "missing ATM" in their community.
Pocket Change can channel 4.7 trillion dollars in rural India to digital, allowing the people there to earn interest or build credit perhaps even for the first time, she said.
"The challenge was to figure out a way that can help us transition some of these people that are living on USD 2 a day, who are not having any bank accounts or any kind of digital savings," said Sheth.
The digital product basically allows anybody to act as an ATM for anybody else, Sheth told PTI.
"We can help them convert the digital money into physical cash so they can use it for their daily use. And by participating they can put their physical cash into their bank account and get interest on it," he said.
According to Cutler, the idea was to match people who wanted to deposit money with people who wanted to withdraw money, to make this Uber-like transaction between people in a community that did not have an ATM infrastructure.
Users scan banknotes into their phones, and the amount and serial number are verified using Google Vision.
The chatbot then connects a user who wants to deposit cash with one who wants to withdraw, based on the amount requested, proximity and trust rating. Users then meet in a safe, public space to carry out the real-life transaction.
Development challenges included security and legal issues, which the team addressed by implementing a user rating system.
"We tried to focus on aspects of security, reliability, reputation, and rating to make the idea feasible for real people," said Culter.
After considering a range of options, the team opted for the chatbot model because it offered a cost-effective solution that would appeal to users who may not be accustomed to using digital products.
"Someone who is technologically illiterate and wants to feel safe and secure, would feel better talking to someone," Culter said.
Using tools such as voice and text recognition, a bot can be "fully conversational", he said.
Disclaimer: No Business Standard Journalist was involved in creation of this content
