scholarly journals Branchless Banking Process in Rural Areas: A Price Barrier?

2021 ◽  
Vol 11 (2) ◽  
pp. 317
Author(s):  
Ktut Silvanita Mangani ◽  
Adolf Bastian Heatubun ◽  
Martua Eliakim Tambunan
Keyword(s):  
Future Development ◽  
Rural Areas ◽  
Financial Services ◽  
Consumer Surplus ◽  
Financial Service ◽  
Financial Inclusion ◽  
Remote Areas ◽  
Program Objective ◽  
Official Rate ◽  
Financial Transactions

Branchless Banking is one of the programs of Indonesia's financial inclusion strategy. The programs' name is "Financial Service Without Office in the Framework of Inclusive Financial" which called “Laku Pandai.” This study aims to portrait the implementation of the Branchless Banking program concerning the obstacles that occurred to achieve program objectives. The research conducted using qualitative methods. The existence of Branchless Banking agents close to the community has fulfilled the program objective, to make an easy way for society to do financial transactions without having to go to the bank office. Therefore, the implementation of the Branchless Banking program met the criteria for eliminating non-price barriers in financial services in remote areas. However, delegation authority to the agent as an extension of the bank to provide limited financial services has encouraged agents to engage in moral hazard behaviors by charging the tariff that greater than the official rate set by the managing bank. It showed that the agent has taken the consumer surplus provided by the Branchless Banking technology. Although accepted by society since considerably cheaper than the fee to go to the nearest bank office, that condition becomes a price barrier for the future development of Branchless Banking.

Tapping the Untapped (Financial Inclusion)

2016 ◽  
Vol 1 (2) ◽  
Author(s):  
Atul Kumar Srivastava
Keyword(s):  
Rural Areas ◽  
Financial Services ◽  
Andhra Pradesh ◽  
Service Providers ◽  
Financial Service ◽  
Financial Inclusion ◽  
Gdp Growth ◽  
Rural People ◽  
Agrarian Economy ◽  
Opening Up

As far as our economic growth is concerned, we are growing rapidly .This statement is easily supported by GDP growth. Is this the growth of our whole economy? Ours is an agrarian economy and if people living in those rural areas are not being taken into account properly, then, it will be wrong to say that we are growing rapidly. A major portion of India lives in villages and that area is being excluded by the financial service providers. This article talks about the potential areas i.e. states regarding financial inclusion. This article tries to look into the problems faced by the bankers while opening up a branch in rural areas and problems the faced by customers. Ultimately, financial service providers have to foray into that field. This article gives an insight regarding financial inclusion. An attempt is being made by RBI , they have given some policies in which it is written clearly that Financial inclusion should be there. But it will be worth while to see the supply barriers in this field. The paper talks about those aspects too. This article discusses the issues raised in Andhra Pradesh recently, which should already be avoided by financial service providers. After all, the efforts of financial service providers should be more target oriented and packed with some strategy regarding financial inclusion and this paper just focuses upon some strategies. A survey of a rural area in Bareilly district was made to know the concerns of rural people regarding financial services. This paper is an attempt to peep into the different facets of financial inclusion but it will become effective only then, when policymakers show their required concern over it.

scholarly journals Information Asymmetry and Trust: A Framework for Studying Microfinance in India

2005 ◽  
Vol 30 (4) ◽  
pp. 77-86 ◽  
Author(s):  
M S Sriram
Keyword(s):  
Social Networks ◽  
Transaction Costs ◽  
Rural Areas ◽  
Financial Services ◽  
Imperfect Information ◽  
Informal Networks ◽  
The Poor ◽  
The People ◽  
Financial Transactions

In recent times, microfinance has emerged as a major innovation in the rural financial marketplace. Microfinance largely addresses the issue of access to financial services. In trying to understand the innovation of microfinance and how it has proved to be effective, the author looks at certain design features of microfinance. He first starts by identifying the need for financial service institutions which is basically to bridge the gap between the need for financial services across time, geographies, and risk profiles. In providing services that bridge this gap, formal institutions have limited access to authentic information both in terms of transaction history and expected behaviour and, therefore, resort to seeking excessive information thereby adding to the transaction costs. The innovation in microfinance has been largely to bridge this gap through a series of trustbased surrogates that take the transaction-related risks to the people who have the information — the community through measures of social collateral. In this paper, the author attempts to examine the trajectory of institutional intermediation in the rural areas, particularly with the poor and how it has evolved over a period of time. It identifies a systematic breach of trust as one of the major problems with the institutional interventions in the area of providing financial services to the poor and argues that microfinance uses trust as an effective mechanism to address one of the issues of imperfect information in financial transactions. The paper also distinguishes between the different models of microfinance and identifies which of these models use trust in a positivist frame and as a coercive mechanism. The specific objectives of the paper are to: Superimpose the role of trust in various types of exchanges and see how it impacts the effectiveness of repeated transactions. While greater access to information fosters trust and thus helps social networks to reduce transaction costs, there could be limits to which exchanges could solely depend on networks and trust. Look at the frontiers where mutual trust cannot work as a surrogate for lower appraisal costs. Use an example in the Canadian context and see how an entity that started on the basis of social networks and trust had to morph into using the techniques used by other formal nonneighbourhood institutions as it grew in size and went beyond a threshold. Using the Canadian example, the author argues that as the transactions get sophisticated, it is possible to achieve what informal networks have achieved through the creative use of information technology. While we find that the role of trust both in the positivist and the coercive frame does provide some interesting insights into how exchanges with the poor could be managed, there still could be breaches in the assumptions. This paper identifies the conditions under which the breaches could possibly happen and also speculates on the effect of such breaches.

scholarly journals A Study on the Impact of Schemes and Programmes of Government of India on Agriculture to Increase Productivity, Profitability, Financial Inclusion, and Welfare of Farmers to Transform them into Modern Society

2021 ◽  
pp. 231-243
Author(s):  
Mahesh K. M. ◽  
P. S. Aithal ◽  
Sharma K. R. S.
Keyword(s):  
Rural Areas ◽  
Financial Services ◽  
Modern Society ◽  
Modern Technology ◽  
Mobile App ◽  
Financial Inclusion ◽  
Agricultural Products ◽  
Theoretical Concepts ◽  
The Government ◽  
The Impact

Purpose: The foremost intent of this research article is to create awareness about various schemes for the productive sector of agriculture. Through this study, the level of performance of these agricultural schemes and programmes were analysed that will be helpful for the attainment of financial inclusion. Hence it is necessary to know about various schemes and their making to connect the beneficiaries. Agriculture is the basic source of food supply, production, processing, promotion and distribution. Agricultural products contribute to Gross Domestic Product (G.D.P.) and generate employment in rural areas. They transform the lives of the farmers in modern society. The government of India has introduced Minimum Support Price (MPS), MIF, PMKSY, PMFBY, e-NAM, PM-KISAN, PMJDY, PM-KUSUM, PKVY, NAMS, and MGNREGS. The mobile app KisanSuvidha and innovative programmes like Kisan Rail, KrishiUdaan double the farmers’ Income (DFI). These help in transforming village economy, coverage of irrigation, crop insurance, and stabilizing the income. They also ensure financial support, flow of credit and Direct Benefit transfer of subsidies and funds to beneficiaries. Adopting modern technology, farm-based activity, poultry, dairy, forestry, beekeeping and with the support of SHGs which will directly impact productivity, profitability, financial inclusion, and the welfare of farmers in the 21st century and development of the country’s economy. Design/ methodology/approaches: This study is all about the theoretical concepts based on analysis of various schemes and interconnect. Findings and results: This study reveals that the effectiveness of various agricultural programs and also identifies the benefits and beneficiaries of these schemes. Under this research, various financial services, subsidies, funds released, online platform for agricultural products, funds for micro-irrigation, and so on benefits provided by the government of India were studied. Originality/value: Analysed the various schemes and compelled its beneficiaries and develop a modern to achieve financial inclusion and economic growth through the study. Type of Paper: Research Analysis.

scholarly journals ROLE OF TECHNOLOGY IN FINANCIAL INCLUSION IN INDIA

2021 ◽  
pp. 1-5
Author(s):  
Arun.K.V
Keyword(s):  
Rural Areas ◽  
Financial Services ◽  
Business Models ◽  
Formal System ◽  
Financial Inclusion ◽  
Handheld Devices ◽  
Mobile Banking ◽  
Major Step ◽  
Banking Business

Technology and financial inclusion are the popular coinage in banking parleys in the country. While technological upgradation and mobile banking are catching up so fast, financial inclusion is tardy. Financial inclusion is a major agenda for the Reserve Bank of India (RBI). Without financial inclusion, banks cannot reach the un-banked. It is also a major step towards increasing savings and achieving balanced growth. The reach the country is having with technological progress mobile banking has the potential to emerge as a game changer in terms of costs, convenience, and speed of reach. Business models of banks, telecom operators and other stakeholders need to converge. However, the banking industry’s penetration to un-banked areas is still found sluggish. The role of the Indian banker is challenging. At one end of this spectrum lies the demand to achieve financial inclusion as nearly 50 per cent of the population is yet to be covered under the formal system of banking and at the other end lies the task to fulfil the needs of the existing customers. The first priority for banks is to adopt core banking solution (CBS), including all regional rural banks (RRBs). Next, a multi-channel approach using handheld devices, mobiles, cards, micro-ATMs, branches and kiosks can be used. However, it should be ensured that the transactions put through such front-end devices should be seamlessly integrated with the banks’ CBS. In rural areas, where accessibility is a problem, banks are using the microfinance network and business correspondents and facilitators to bring more people under the ambit of banking services. Capitalising on the huge untapped potential in smaller towns and cities and rendering financial services to this segment of people poses a big challenge. Few banks have explored technology solutions to increase the scale of their microfinance portfolios, with the use of smart cards and core banking solutions. KEYWORDS- Technology, Financial Inclusion, Core Banking, Business Correspondents

scholarly journals The Nexus between Mobile Money Regulation, Innovative Technology and the Promotion of Financial Inclusion in Zimbabwe

2021 ◽  
Vol 24 ◽  
pp. 1-33
Author(s):  
Howard Chitimira ◽  
Elfas Torerai
Keyword(s):  
Low Income ◽  
Rural Areas ◽  
Financial Services ◽  
Banking Sector ◽  
Regulatory Framework ◽  
Financial Inclusion ◽  
Innovative Technology ◽  
Technological Innovations ◽  
Mobile Money ◽  
The Poor

The advent of mobile money innovations has given people in rural areas, informal settlements and other poor communities an opportunity to participate in Zimbabwe's mainstream financial economy. However, the technology-driven money services have presented some challenges to the traditional banking sector in general and the regulation of financial services in particular. Firstly, most mobile money services are products of telecommunication corporations, which are not banks. Telecommunication companies use their network reach to provide mobile money services via mobile devices at a cheaper cost than banks across the country in Zimbabwe. As such, banks face unprecedented competition from telecommunications companies that are venturing into financial services. It also appears that prudential regulation of banks cannot keep up with the fast pace at which technological innovations are developing and this has created a disjuncture between the regulation and the use of technological innovations to promote financial inclusion in Zimbabwe. The Banking Act [Chapter 24:20] 9 of 1999, the Reserve Bank of Zimbabwe Act [Chapter 22:15] 5 of 1999 and the National Payment Systems Act [Chapter 24:23] 21 of 2001 have a limited scope in terms of the regulation of mobile money services in Zimbabwe. The Ministry of Finance and Economic Development launched the National Financial Inclusion Strategy (NFIS) 2016-2020 to provide impetus to the financial inclusion of the poor, unbanked and low-income earners in Zimbabwe. However, the NFIS appears to push more for bank-led financial inclusion than it does for innovation-driven initiatives such as mobile money services. This article highlights the positive influence of mobile money services in improving financial inclusion for the poor, unbanked and low-income earners in Zimbabwe. The article also seeks to point out gaps and flaws in the financial services regulatory framework that may limit the potential of mobile money services to reach more people so that they actively participate in the Zimbabwean economy. It is submitted that the Zimbabwean mobile money services regulations and the financial regulatory framework should be carefully amended in line with the recent innovations in mobile money to adequately regulate the use of mobile money services and innovative technology to address the financial exclusion of the poor, unbanked and low-income earners in Zimbabwe.

scholarly journals Improvement of the Financial Services Market in the Context of Ensuring the Financial Inclusion

2021 ◽  
Vol 8 (523) ◽  
pp. 127-134
Author(s):  
O. V. Zhulyn ◽  
Keyword(s):  
Behavioral Finance ◽  
Financial Literacy ◽  
Financial Services ◽  
Digital Technologies ◽  
Financial Service ◽  
Financial Inclusion ◽  
Low Incomes ◽  
Analytical Research ◽  
Low Levels ◽  
Theoretical Foundations

The article is aimed at studying the theoretical, organizational and methodical aspects of financial inclusion; conducting an analytical research on the development of financial inclusion and its impact on the welfare of the population; formation of recommendations for improving the financial services market in the conditions of ensuring the financial inclusion in Ukraine. The theoretical foundations of financial inclusion and its components are considered, the author suggests to enclose therein the speed and security of obtaining a financial service, which is provided with the help of digital technologies, which is relevant in the context of the COVID-19 pandemic. The carried out analytical studies of financial inclusion in the world and in Ukraine have shown that its level is constantly growing and there are sufficient prerequisites for its development, including in the financial market the maximum number of the population who will be able to benefit from the use of financial services. As a result of the analysis, a framework for financial inclusion has been developed that allows identifying entities that are often unwittingly excluded from the financial services market – due to low levels of financial literacy, low incomes or discrimination on the part of financial institutions. An important aspect of the implementation of the concept of financial inclusion is the motivation to use financial services, using behavioral finance methods for this – not only by those who are forced to exclude, but also those who voluntarily refused to use them. The publication proposes recommendations and instruments for improving the financial services market, which will increase the level of financial inclusion, which in turn will contribute to economic growth, mobilization of savings, their preservation and increase, introduction of innovations and development of entrepreneurship.

Mobile Financial Services

2020 ◽  
pp. 96-119
Author(s):  
Alexander Maina Kimari ◽  
Eric Blanco Niyitunga
Keyword(s):  
Financial Services ◽  
Developing World ◽  
Service Providers ◽  
Customer Experience ◽  
Financial Service ◽  
Financial Inclusion ◽  
The Poor ◽  
Financial Exclusion ◽  
Mobile Financial Services

The chapter explores financial exclusion, its causes, and consequences in society. The chapter found that the existing discrepancy in financial inclusion between the developed and developing world is driven by financial exclusion that makes it difficult for financial service providers to expand outreach to the poor at affordable prices. The chapter aims to investigate the role of mobile financial service design and development in dealing with financial exclusion. It was found that mobile financial services are promoting financial inclusion in various markets. However, few studies have been undertaken on the benefits of mobile financial services in dealing with the high rates of financial exclusion. The chapter recommended that to achieve financial inclusion, there is need for mobile financial services providers to take into account customer experience through the ease of using the phone interface. The chapter concluded that there is need for scholars in the fields of finance and economics to conduct research in the areas of mobile financial services and their role in society.

scholarly journals Marketing of Financial Service: Evidence from Nigeria Financial Market

2018 ◽  
Vol 2 (1) ◽  
pp. 31-46
Author(s):  
Lucky Anyike Lucky
Keyword(s):  
Financial Market ◽  
Financial Services ◽  
Service Marketing ◽  
Distribution Channels ◽  
Financial Service ◽  
Financial Inclusion ◽  
The Internet ◽  
Marketing Environment ◽  
Financial Products ◽  
Growing Population

Nigeria financial market is emerging, the growth in institutions and products require a marketing strategy that will meet the needs of growing population. This study examined marketing of financial services. It discussed financial service products, segmentation of financial products, brands in financial market, financial service marketing environment, marketing of financial service through the internet, distribution channels of financial products, strength, weakness, opportunities and threat of Nigeria financial market, the needs for marketing of financial services, features of financial products and pricing of financial products. The study concludes that marketing of financial services is a determinant of financial inclusion, therefore policies and strategies should be advanced by management and regulators in the financial market.

scholarly journals SECURITY OF CORPORATE INFORMATION IN FINTECH ECOSYSTEM

2021 ◽  
Vol 119 (6) ◽  
pp. 98-108
Author(s):  
CHUBAIEVSKYI Vitalii ◽  
VOLOSOVYCH Svitlana
Keyword(s):  
Information Systems ◽  
Financial Services ◽  
Financial Service ◽  
Corporate Information System ◽  
Technology Tools ◽  
Business Entities ◽  
Corporate Information Systems ◽  
Financial Transactions ◽  
Corporate Information ◽  
Financial Technology

Background. With the intensification of digitalization processes, the use of FinTech tools by various business entities, which include both financial service offerors and their consumers, is becoming especially important. Analysis of recent researches and publications. The works of many scientists are devoted to the functioning of various aspects of corporate information systems. However, there is currently a lack of research on the feasibility of using financial technology instruments by business entities, their threats and security for corporate information systems. The aim of the article is to study the place of FinTech tools in the corporate information system, identify threats to their use and ensure the security of their operation. Materials and methods. The theoretical and methodological basis of the study are the works of domestic and foreign scientists on the functioning of corporate information systems and FinTech ecosystems. Results. The basis of digital transformation is the use of innovative technologies in the financial services market. This leads to the appropriate transformation of information systems of business entities and ensuring their security. There is an intensification of business use of digital banking services, digital insurance, payment platforms, raising funds through crowdfunding platforms, investing. The FinTech ecosystem within the sectoral approach should be understood as the areas of application of financial technology instruments, the services of which are used by various consumers, in particular, business entities, individuals, public authorities.The increasing digitalization of financial activities of business entities as a result of the Covid-19 pandemic has intensified the creation of additional challenges for corporate information systems for the implementation of cyber risks. Conclusion. The use of financial technology tools by business entities leads to the formation of FinTech ecosystems. Ensuring the security of information systems is the key to corporate stability. The challenge of countering cyber threats is not only for financial service offerors, but also for business entities that are their consumers, as the use of financial technology tools in financial transactions causes risks to all participants in the FinTech ecosystem.

Sign in / Sign up

Export Citation Format

Share Document