Financial Inclusion in Action

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Learning from (and about) India´s Emerging Digital Money Grid

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  The Government of India has embarked on a remarkable path to connect all its citizens onto a digital platform through which they can, in real-time, confirm their identity, financially transact with anyone else, and store relevant documentation in natively digital format and consent to it being shared digitally with others (for instance, to support… Continue reading

Will Mobile Network Operators Make It As Payments Banks?

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Of the remaining eight provisional Payments Bank licensees, four involve mobile network operators (MNOs): Airtel, Idea, Vodafone, and Reliance Jio.    This is not surprising, since successful Payments Banks will require a large footprint to serve a massive customer base, as it will be a volume game. MNOs’ existing customer base and extensive agent networks… Continue reading

Can Payments Banks Survive?

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The news that three of the provisional licensees, Cholamandalam Distribution Services, Dilip Shanghvi and Tech Mahindra, have decided not to seek a full Payments Bank license, has caused much debate. The reasons for their withdrawal are varied – and not all necessarily based on the challenges posed by the underlying business model. Despite this, the… Continue reading

Open Application Programming Interfaces (API): Purpose and Possibilities

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Application Programming Interface or API, a software programme, acts as a bridge between disparate applications. It performs the intended function when a set of instructions are provided through a user interface (UI). The front-end of UI is usually a website or mobile application. The following diagram illustrates the basic architecture of any API-based business model:… Continue reading

Offline Payment Acceptance: A Puzzle and an Opportunity

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As Indians, we love cash, which is fungible and provides instant gratification – allowing us to buy anything across the country. Cash speaks one language, does not discriminate, and provides a seamless experience!   RBI estimates that 96% of all the retail transactions in the country are conducted using cash, leaving only about 4% payments… Continue reading

JAM – Using (Jan Dhan) Bank Accounts, Aadhaar and Mobiles to create new products and services, and new ways of doing things

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Jan Dhan Yojana, Aadhaar and Mobile or ‘JAM’ are creating a buzz in financial inclusion space, not only in India but across the world. JAM has been jamming newsrooms and social media after being coined in the Economic Survey 2015 and the Union Budget 2015.    The JAM trinity is seen as an important tool… Continue reading

Low Preference for Cash Transfer in TPDS – What Affects Beneficiary Behaviour?

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The cash versus in-kind subsidy transfer (e.g., food, fuel or fertiliser subsidy)[i] has generated much debate all around the globe. However, there is no clarity on which method should be adopted going forward – cash or in-kind subsidies. While both cash and in-kind transfers certainly have an important role in addressing food security, there is… Continue reading

India Post – Initiatives to Facilitate G2P Payments

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India Post has extensive outreach in rural areas of Jharkhand with 13 Head Post Offices (HPOs), 454 Sub Post Offices (SPOs) and 2,643 Branch Post Office (BPOs).[1] With 3,097 (454 SPOs + 2,643 BPOs) outlets present in rural and semi-urban areas, India Post has a reach of at least one outlet for every two of the… Continue reading

Financial Capability and Indian Digital Financial Services

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The World Bank Institute highlights that behavioural change with regard to financial capability is a non-linear process and requires more than receiving compelling information. For an evolving channel like DFS, which has several models of service delivery, this brings its own set of challenges. For DFS to be used to its full potential, it is… Continue reading

Customer Vulnerability, Trust and Risk in Indian Digital Financial Services

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Qualitative research done as a part of MicroSave’s study for the Omidyar Network on customer production, risk and financial capability in India shows that customers’ perceptions of banking or financial transactions are still focused on brick and mortar based services. DFS providers have not done enough to change the customer’s perception and gain trust. The… Continue reading