India covers 21 percent of the world’s unbanked population and has only 61 regional rural banks. As people in rural India often lack documents that KYC norms require to open a bank account, these regional banks are not of much help.
However, with the evolving technology in the BFSI sector, a new breed of Fintech companies are partnering with national and regional banks to penetrate into the rural areas. Be it tablet banking or solar powered ATMs, people in the remotest corners of the country seem to be set to have access to banking facilities at the tip of their fingers.
Here are five BFSI companies which are reaching out to the unbanked population and changing the face of Indian Banking industry:
What it does: Novopay is a Bengaluru-based, start-up that provides banking to the unbanked regions by helping people set up their own bank account and manage their finances. It allows them to send/receive money, pay bills, recharge and shop through the Novopay mobile wallet.
How? A Kirana store owner can become a Novopay agent by downloading the Novopay retailer app and all these wallets are connected on a cloud based platform. People in turn can walk upto him and open their bank accounts with just the use of their fingerprints and deposit or withdraw sums as low as 100 rupees. The Novopay agent can provide all the services which big banks in the cities do.
Partners: RBL Bank, Axis Bank, Bank of India, IDFC Bank
What it does: Vaya Finserv is a Hyderabad-based, business correspondent firm using tablet banking to provide seamless core banking systems in rural areas and loans for women’s self –help groups.
How? Vaya has built its operational architecture by employing innovative real time tablet banking wherein each field officer is equipped with a tablet to help people in the rural areas perform multiple electronic transactions and generate savings through their bank accounts. Vaya also trains its potential clients in an intensive week long mandatory financial awareness program to avail banking facilities and reduce errors.
Partners: Vaya has partnered with YES bank and The Ratnakar Bank to provide financial facilities in under-banked disctricts of Maharashtra, Karnataka, Odisha, Bihar and Jharkhand.
Vortex Engineering Private Limited:
What it does: Vortex Engineering is a Chennai-based company and the leading provider of world’s lowest power consuming ATMs. Vortex helps banks roll out end-to-end ATM services in the rural areas through its solar powered ATMs. Setting up these machines incurs huge capital expenditure.
How? Vortex has specifically designed ATMs that could operate in temperatures of up to 50 degree Celsius. The ATM not only consumes minimal power but comprises very few mechanical and electronic parts as compared to the conventional ATMs. All these capabilities make Vortex ATMs suitable for deployment in areas having severe power shortage.
Partners: Vortex has set up 545 ATMs including 300 solar powered ATMs for the State Bank of India.
Eko India Financial Services:
What it does: Eko India Financial Services is a New Delhi-based fintech company which provides no-frills bank accounts and deposit, withdrawals and remittance services to the customers out of which 80 per cent are unbanked migrants. Its services are delivered through mobile devices.
How? Eko provides products like APIs and Fundu wherein one can create their own wallet based product and services. The app enables instant person-to-person transfers, quick bank transfers and other such facilities.
Partners: Eko has paired up with State Bank of India, Yes Bank and ICICI Bank to cater to areas of Delhi NCR, six districts of Bihar and one district of Jharkhand. It also provides Bharti AXA Life- Bhachat Bima, micro insurance policies with Bharti AXA Life Insurance Company.
What it does: This Bangalore-based, BFSI Software Consultancy has developed a mobile platform, called Egalite, which integrates the core banking systems of banks with the mobile devices used by the business correspondents.
How? The company's solution works on Oracle’s core banking software solution, FlexCube. The Android based mobile platform application syncs up directly with the bank’s/micro-financial Institution’s core banking system and updates the data, in real-time, given the device is connected to the internet.
Partners: ING Vysya bank, Bharti Axa