NATIONAL INITIATIVE FOR FINANCIAL INCLUSION

18 SEPTEMBER, 2009
STATE BANK OF INDIA 1
SBI IN THE NEWS

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 NATIONAL INITIATIVE FOR FINANCIAL INCLUSION

OUTREACH STRATEGY AND INITIATIVES

TECHNOLOGY STRATEGIES AND INITIATIVES

SBI’S CONTRIBUTION TO MICRO FINANCE

FINANCIAL INCLUSION - ACHIEVEMENTS

FINANCIAL INCLUSION : SUCCESS STORIES AND BEST

PRACTICES

BC/BF- CHALLENGES AND LEARNINGS

FINANCIAL INCLUSION : SUGGESTIONS

STATE BANK OF INDIA 3

OUTREACH STRATEGY
Alternate Channels
• Aggressively increase
number of customer service
points
• Leverage technology to
reduce costs
FI aspirations
Enhance Delivery Capabilities
• Set up specialized Rural
Central Processing Centres to 3
enhance credit processing
capacity
Mobile Marketing & Recovery
Teams (MRTs)
• Increase number of MRTs
1 2
• Enhance Role to achieve full
financial inclusion
• Deployed in identified RUSU
centres
in RUSU
Expand Through Branches
• Second wave of branch
4 expansion – 870 new RUSU
branches in 2009-10
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390
OUTREACH THROUGH BC/BF

Support CSPs through dedicated cadre of Channel Management

Facilitators
MAJOR NATIONAL ALLIANCES
 India Post  3i Infotech Foundation (Kiosk based)
 Zero MASS Foundations  Kalanjiam Dev. Fin. Services
 Drishtee Foundation  Grameen Pragati
 FINO Fintech Foundation  ITC Limited (BF)
 EKO Aspire Foundation

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OUTREACH THROUGH BRANCH AND ATM EXPANSION

 1000 new low cost ATMs specially for rural and semi urban areas
planned this year.

 Mobile Marketing and Recovery Teams support these Branches acting

as spokes for the Branch hubs.
STATE BANK OF INDIA 6
 NATIONAL INITIATIVE FOR FINANCIAL INCLUSION

OUTREACH STRATEGY AND INITIATIVES

TECHNOLOGY STRATEGIES AND INITIATIVES

SBI’S CONTRIBUTION TO MICRO FINANCE

FINANCIAL INCLUSION - ACHIEVEMENTS

FINANCIAL INCLUSION : SUCCESS STORIES AND BEST

PRACTICES

BC/BF- CHALLENGES AND LEARNINGS

FINANCIAL INCLUSION : SUGGESTIONS

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TECHNOLOGY STRATEGIES

 Different geographies and different infrastructure mandate the

need to engage varied Technology platforms and processes.

 Multiple front end technologies with a common back end process.

All accounts to be in the CBS of the Bank eventually.

 Added focus on Interoperability, Scalability and Security issues

Initiatives introduced proactively to institutionalize key

processes and systems

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SBI’S TECHNOLOGY INITIATIVES
SBI Tiny Card

KIOSK Banking

Cell phone based messaging

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 NATIONAL INITIATIVE FOR FINANCIAL INCLUSION

OUTREACH STRATEGY AND INITIATIVES

TECHNOLOGY STRATEGIES AND INITIATIVES

SBI’S CONTRIBUTION TO MICRO FINANCE

FINANCIAL INCLUSION - ACHIEVEMENTS

FINANCIAL INCLUSION : SUCCESS STORIES AND BEST

PRACTICES

BC/BF- CHALLENGES AND LEARNINGS

FINANCIAL INCLUSION : SUGGESTIONS

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SBI’S CONTRIBUTION TO MICRO FINANCE

 Market share among Commercial Banks above 40%.

 More than 165 MFIs (including NBFCs) sanctioned Rs.1,125 cr so

far, for on-lending to SHGs/ JLGs and Individuals.

 Special products for SHGs, like SHG card, SHG Gold card, Sahyog
Niwas developed
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SBI’S CONTRIBUTION TO MICRO FINANCE

Insurance and Investment avenues for Micro customers

Grameen Shakti
 Life Insurance product for SHGs members .
 Life Insurance cover varies from Rs. 5,000 to Rs. 50, 000.
 Annual premium varies from Rs. 60 to Rs. 601.
 Provision for refund of 50% of Premium for a term of 5 years and
100% premium for term of 10 years.
 More than 9 lakh SHG members covered so far

SBI Chhota SIP

 A systematic investment plan with added feature of low monthly
investment amount of 100.
 To provide investment opportunity to low income group who otherwise
do not benefit from capital markets

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 NATIONAL INITIATIVE FOR FINANCIAL INCLUSION

OUTREACH STRATEGY AND INITIATIVES

TECHNOLOGY STRATEGIES AND INITIATIVES

SBI’S CONTRIBUTION TO MICRO FINANCE

FINANCIAL INCLUSION - ACHIEVEMENTS

FINANCIAL INCLUSION: SUCCESS STORIES AND BEST

PRACTICES

BC/BF- CHALLENGES AND LEARNINGS

FINANCIAL INCLUSION : SUGGESTIONS

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FINANCIAL INCLUSION - ACHIEVEMENTS
COVERAGE OF NEW
GEOGRAPHIES

Unbanked Villages Total Villages

 95% of RUSU branches achieved the target of 250 rural household accounts per
annum as stipulated by Rangarajan Committee.

 151 lakh households covered in 84,186 villages under 100% Financial Inclusion of
SLBC project

 About 29 lakh customers enrolled through Technology based accounts.

Another 26 lakh No Frills accounts opened at branches.

 More than 200 RCPCs set up to enhance credit processing capabilities.

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 NATIONAL INITIATIVE FOR FINANCIAL INCLUSION

OUTREACH STRATEGY AND INITIATIVES

TECHNOLOGY STRATEGIES AND INITIATIVES

SBI’S CONTRIBUTION TO MICRO FINANCE

FINANCIAL INCLUSION - ACHIEVEMENTS

FINANCIAL INCLUSION: SUCCESS STORIES AND BEST

PRACTICES

BC/BF- CHALLENGES AND LEARNINGS

FINANCIAL INCLUSION : SUGGESTIONS

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FINANCIAL INCLUSION: SUCCESS STORIES OF SBI

 BUSINESS CORRESPONDENT (BC) CHANNEL -

MAHARASHTRA
 INDIA POST AS BC IN AMRAVATI, CHANDRAPUR & NAGPUR
 No. of Post Offices
DISTRICTS. 20
Performance
No. of villages
: covered 137
Of which, Unbanked villages 118
 No. of smart cards issued 38,900
 No. of other deposit accounts 1,023
 No. of Loan accounts 818
 Total amount of deposits mobilized Rs.4.85 crores
 Total amount of loans sanctioned Rs.7.69 crores
 Average business per post office p.m. Rs.2.61 lacs
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FINANCIAL INCLUSION: SUCCESS STORIES OF SBI
 BUSINESS CORRESPONDENT CHANNEL – NORTH
EAST REGION
 DRISHTEE FOUNDATION AS BC IN NORTH EAST REGION

Performance :
No. of active CSPs 199
 No. of villages covered 450
Of which, no. of unbanked villages 265
 No. of smart cards issued 4,935
 No. of other deposit accounts 11,493
 No. of Loan accounts 1,623
 Total amount of deposits mobilized Rs.2.99 crores
 Total amount of loans sanctioned Rs.8.22 crores

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FINANCIAL INCLUSION: BEST PRACTICES OF SBI

 Operational guidelines for BC/BF put in place

 Dedicated Channel Management Facilitators for

continuous monitoring and mentoring of CSPs.

 Performance Monitoring systems put in place - Channel

Management Software for tracking performance of
BC/BF/CSPs.
 On to integrating Technology for providing the best
technology driven Financial Inclusion products / services

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 NATIONAL INITIATIVE FOR FINANCIAL INCLUSION

OUTREACH STRATEGY AND INITIATIVES

TECHNOLOGY STRATEGIES AND INITIATIVES

SBI’S CONTRIBUTION TO MICRO FINANCE

FINANCIAL INCLUSION - ACHIEVEMENTS

FINANCIAL INCLUSION: SUCCESS STORIES AND BEST

PRACTICES

BC/BF- CHALLENGES AND LEARNINGS

FINANCIAL INCLUSION : SUGGESTIONS

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BC/BF- CHALLENGES AND LEARNINGS
 Viability of BCs – High investment with low returns

 Getting suitable CSPs.

 Cash management.

 Service Tax on BC/BF activities - avoidable formalities.

 Technology challenges for expansion, cost and

interoperability issues.

 Risk Mitigation.

 Customer Education

 Absence of a Governmental support framework for viability

of BCs.
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 NATIONAL INITIATIVE FOR FINANCIAL INCLUSION

OUTREACH STRATEGY AND INITIATIVES

TECHNOLOGY STRATEGIES AND INITIATIVES

SBI’S CONTRIBUTION TO MICRO FINANCE

FINANCIAL INCLUSION - ACHIEVEMENTS

FINANCIAL INCLUSION: SUCCESS STORIES AND BEST

PRACTICES

BC/BF- CHALLENGES AND LEARNINGS

FINANCIAL INCLUSION : SUGGESTIONS

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FINANCIAL INCLUSION : SUGGESTIONS- BC CHANNEL

ntroduction of technology enabled products by Banks,

Insurance and Mutual Funds.

overnments to use technology based accounts for effecting

benefit transfers (like NREGA, Social Security pension etc.)
and provide support for channel build up.

inancial Inclusion Literacy – Spreading awareness is a

responsibility of all operating level stake holders, viz. : Govt,
RBI, NABARD, Banks, Insurance Cos, NGOs etc.

ocial upliftment plans (like NREGA, SSP) should allocate a

fund to support channel build up
STATE BANK under a common plan.
OF INDIA 22
FINANCIAL INCLUSION : SUGGESTIONS- BC CHANNEL

asket of entities eligible to be appointed as BCs should be

expanded (shop keepers, petrol pumps etc) as
recommended by the working group of RBI.

BI incentive of Rs.50 per ‘No Frills’ account should be

extended for all accounts irrespective of whether they are
used for Govt. payments or not.

emuneration received by BC/BF/CSPs should be kept

outside the purview of service tax.
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FINANCIAL INCLUSION : SUGGESTIONS - MFI

 Extension of Credit Guarantee scheme of Credit Guarantee

Fund Trust to cover Bank loans to MFIs/NBFCs for on
lending.

 CIBIL should develop appropriate data-base relating to

Micro Finance Sector also to aid for Bankers in their
exercising due diligence in financing MFIs.

 Bringing MFIs under NABARD regulation and putting in

standardized norms for lending / equity support to MFIs.

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