Promoting Financial Inclusion - United Nations Development ...

• Commission structure: The BC agents do
not receive any minimum remuneration
and their pay structure is completely
commission based. BCs receive `10
per NFA and `50 per bank’s savings
accounts. Furthermore, they are also
entitled to receive 1% of loan amount
and FD facilitated by them through
bank. However, it should be noted that
currently BCs do not work upon loan
applications and 3% of Drishtee’s BCs are
also engaged in Drishtee’s microfinance.
As per rough estimates, the activities of
BCs are not lucrative since they earn on
an average `700 to `1,200 per month.
Problems Faced by Drishtee in
Implementation
The study tried to assess some main
problems in this model in order to judge
the viability and sustainability of the model.
Some of the issues are specified below:
(i) Problems with existing technology: The
study team was informed that Drishtee
is planning to change its technology
partners due to problems with the
existing technology, such as:
• The mobile phone set has GPRS
activated in it but it does not operate
in certain villages due to network
problems.
• The card is provided directly by
ALW to BC agents and to final
customer. As a result, there are many
variables in the service provider
chain and probability of delays
increases.
(ii) Attrition rate: Drishtee faces the problem
of high attrition rate since majority of
BCs work on a part time basis and are
demotivated by low income earned as
BC agent.
(iii) Changes in strategy: Drishtee has been
using card based technology provided
by ALW for the past three years of its
operations. However, recently it has
decided to change technology provider
and select kiosk banking model
development by Tata Consultancy
Services (TCS). Under this model
biometric devices instead of smart
card devices are used and integrated
with core banking tools. Currently
SBI is striving to undertake phase wise
migration of clients by tagging card
based clients with kiosk based clients.
Resultantly Drishtee has temporarily
suspended its operations and is not
engaged in customer acquisition.
(iv) Problems faced by BCs in their daily
operations: Drishtee reviews work of
BCs at timely intervals, hence they
were asked to specify some of the
main problems faced by BCs in their
operations. Some of the issues are
• The BCs find it difficult to sell
savings products since people are
more interested in obtaining credit
and procuring remittance services
• BCs have to face resistance from
local bank’s branch managers, who
are sometimes not forthcoming
and willing to use services of BC
agents.
Progress So Far
As per the estimates, approximately 50,000
SBI savings accounts and 10,000 NFAs
have been opened by Drishtee’s BC agents
in the last three years. However, just 20% to
30% of these accounts are currently active
due to various reasons such as propensity
to save and differences in client behaviour.
A discussion on viability and long term
growth proposition of BC model indicated
that the model can be undertaken only
if banks provide a host of services and a
proper follow up on use of such services
is undertaken. Furthermore, BCs find it
expensive to deploy an outside technology
provider due to high costs of machines and
PROMOTING FINANCIAL INCLUSION 53