A STUDY ON

BUSINESS CORRESPONDENT MODEL UNDER FINANCIAL

INCLUSION DRIVE IN SURENDRANAGAR DISTRICT OF
GUJARAT
SUMMER INTERNSHIP PROJECT

SUBMITTED TO

NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT
GUJARAT REGIONAL OFFICE, AHMEDABAD

SUBMITTED BY
SMITKUMAR K. HINGRAJIYA
M.SC (ICT-ARD)
DA-IICT, GANDHINAGAR

Business Correspondent Model Under Financial Inclusion Drive 2


DECLARATION

I Smitkumar K. Hingrajiya, Post Graduate student of Information and
Communication Technology in Agriculture and Rural Development (M Sc ICT-
ARD), 2010-11 batch, from Dhirubhai Ambani Institute of Information and
Communication Technology (DA-IICT), Gandhinagar, Gujarat hereby declare
that this project report titled, Business Correspondent Model under
Financial Inclusion Drive is an original study and has been carried out by
me as a part of Summer Internship under the guidance of Mr. M.
Subramanian (Deputy General Manager) and Dr. Vinod Vidyarthi (Assistant
General Managers) NABARD, Gujarat Regional Office, Ahmedabad.
I further declare that no any part of this report has been copied from
any source, or if taken, the original source has been given due credit in the
content. I have worked for eight weeks on our summer project as required
under manual of policies of our institute.



Place: Smitkumar K. Hingrajiya
Date: ID: 201113002




Business Correspondent Model Under Financial Inclusion Drive 3


CERTIFICATE

This is to certify that Mr Smitkumar K Hingrajiya, student of Master of Science in
Information and Communication Technology in Agriculture and Rural Development
(M.Sc ICT-ARD), batch 2010-12 of DA-IICT (Dhirubhai Ambani Institute of Information
and Communication Technology) has successfully completed his Summer Internship
during May-June 2011 for duration of eight weeks.
The project titled: Business Correspondent Model Under Financial Inclusion
Drive was undertaken in the Financial Inclusion Department (FID) in the National Bank
for Agriculture and Rural Development (NABARD), Gujarat Regional Office,
Ahmedabad.
The project report was completed under the guidance Mr. M. Subramanian, Deputy
General Managers and Dr. Vinod Vidyarthi, Assistant General Managers, Gujarat RO
NABARD.
I hereby certify that the report fulfils all the stated criteria and is up to the mark to the
best of my knowledge.


M. Subramanian Dr. Vinod Vidyarthi
Deputy General Manager Assistant General Manager
NABARD NABARD
Gujarat R O, Ahmedabad Gujarat R O, Ahmedabad
Date: 18 July 2012 Date: 18 July 2012



Business Correspondent Model Under Financial Inclusion Drive 4

ACKNOWLEDGEMENT
I would like to be thankful of god who is almighty in world. Thereafter I am grateful to my
parents and teachers who are responsible for all of my success for ever.
Diction is not enough to express my sincere gratitude and indebtedness to Shri H R Dave
Chief General Managers, NABARD, Gujarat Regional Office and all other Senior Officers
and staff from NABARD, Gujarat R.O. for giving me an opportunity to work on this project
for my summer internship.
Thereafter from the inner sanctum of my heart I am obliged to Shri Sanjay R Desai (GM,
NABARD), for his incessant support. I take this opportunity to extend my heartiest thanks to
Shri M. Subramanian (DGM, NABARD), Dr. Vinod Vidyarthi (AGM, NABARD) and Y. Sujata
Anil (AGM, FID, NABARD), my mentors for their meticulous guidance, concrete suggestions
and constant encouragement throughout the course of the project.
I gratefully acknowledge

i. The valuable inputs and insights offered by officers from Financial Inclusion Department,
Gujarat R.O.
ii. Mr. Rajesh Errimal (District Development Manager, Surendrangar) and officials of lead
lank, district administrative office and SGB region office for providing detailed information
and facilitating as well as accompanying me during my field visit.
iii. All the branch managers, BC and all villagers who had given their feedback on the BC
model and financial inclusion plan
Diction is not enough to express my sincere gratitude and indebtedness to my professors
(DA-IICT), my friends and entire staff of DA-IICT, Gandhinagar for their constant support
and encouragement.

Smitkumar K Hingrajiya
Business Correspondent Model Under Financial Inclusion Drive 5

EXECUTIVE SUMMARY
Now a days money is one of the basic requirements of human beings. Growth
of a country is depends on how money is utilized by its citizens. Savings of the
citizens has also same importance. For the purpose of giving such financial
services in easy and convenient way government has developed many financial
plans. These plans are helpful for people who want to access financial services.
As per survey report of NSSO survey 59
th
round, 51.4% of farmer households
are financially excluded from both formal / informal sources. From the total
farmer households, only 27% access formal sources of credit; one third of this
group also borrows from non-formal sources. Overall, 73% of farmer
households have no access to formal sources of credit. Marginal farmer
households constitute 66% of total farm households. Only 45% of these
households are indebted to either formal or non formal sources of finance.
About 20% of indebted marginal farmer households have access to formal
sources of credit. Among non-cultivator households nearly 80% do not access
credit from any source.
Every citizen of India should have an account holder in any bank which is the
ultimate goal of Government of India. To achieve this goal, Government of India
and Reserve Bank of India have accepted the concept of Financial Inclusion
broadly.
Financial Inclusion may be defined as the process of ensuring access to
financial services and timely and adequate credit where needed by vulnerable
groups such as weaker sections and low income groups at an affordable cost.
Under this plan they have decided to provide financial facility in affordable cost
to people who are unable to utilize it. For successful implementation of this plan
RBI instructed banks to make financial services available in rural areas. It is not
possible for banks to open brick and mortar branches in every village of
country. Therefore, alternative model like ultra-small branches, mobile-van
Business Correspondent Model Under Financial Inclusion Drive 6

facility and business correspondent (BC) or business facilitator (BF) models are
introduce to make financial services available in rural areas.
Amongst these alternatives BC & BF model is most convenient model. It is now
widely used by banks to reach remote areas. The concept of BC & BF has been
started in 2006. BC & BF are nothing but the representative of banks who
provides banking services through use of ICT based solutions in his own or
nearby villages. Banks give remuneration and or transaction based commission
to him against his service.
Objective of study
In this report we discussed working of BC in Surendranagar district of Gujarat.
The objective of study is to find out viability of BC model as part of FI plan, how
BC works in village and what problems he faces while working as BC/BF in
village. Study also try to find out different models and patterns opted by
different banks. Pros and cons in implementation of BC/BF model for bankers
and the gap between the expectations of all the partners i.e. BC/BF, banks and
villagers.
Methodology
In Gujarat, Surendranagar district has done the highest work under FI.
Therefore, Surendranagar district of Gujarat has been selected for pupose of the
study. Saurashtra Gramin Bank (SGB) is major RRB in Surendranagar district.
Therefore, five SGB branches were selected for primary data collection. 10
villages of four blocks which have population above 2000 and were identified for
FI were selected. Accordingly 10 BC were selected one each from 10 villages
and 10 of the respective BCs clients and 5 non clients were selected for data
collection.


Business Correspondent Model Under Financial Inclusion Drive 7

Major Findings
POS device has not been issued to all the BCs. From sample study out of
10 BCs, 3 BC could not get device.
Issued device has not been working properly it has many technical
problems.
Smart-card is another issue; it is not given to all account holders who
have opened account through POS device.
It takes one or one and half month for getting smart card after opening of
account.
Other problem pertaining to the device is network connectivity.
The person who is willing to open account through BC has to come four to
five times to him because of network connectivity problem.
All the 10 BCs were appointed during September, 2011 to December,
2011 but still they could not do any transaction through POS device.
Bank has committed to pay to each BC get Rs. 2000/- per month, Rs. 1/-
per transaction and Rs. 2.50/- per kilometer transportation. However, it is
observed that BC has only got his fixed salary, the other transportation
cost and transaction commission has still not been given to him.
BC has many pending request of account opening but because of
documentation problem accounts cannot be opened.
Lack of awareness is there. People of village do not know anything about
banking services and financial inclusion.
Another problem is acceptability. People of village have not easily
accepted the concept of banking with BC.
Bank staff is also not clear about financial inclusion.
Bank staff is not supportive in some branches due to lack of knowledge.
Need for FI is not impressed upon them.
Some of the banks clients want to transfer their account from main
branch to BC so that they can save commutation time and transportation
cost.
Business Correspondent Model Under Financial Inclusion Drive 8

Some of the customers wants dual access to their a/c i.e. via BC & branch
both.
Cash handling limit given to BC is not adeguate.
Due to lack of income generation, many people in rural areas do not have
access to BC/BF for opening of account. And even if they have they are
not having time to go to banks & hence door to door service is essential.
Suggestions
POS device should be given to BC as quickly as possible and made
available on priority.
The technical training should be imparted to BCs for helping them to
handle the device efficiently.
Smart card should be issued to client within week of opening of account,
so that account holder can use his account and make transactions.
Transaction should be made possible from both BC and branch through
same smart card.
Smartcard which is given to BC should be made accessible at any place
have good network connectivity within the village. This will enable BCs to
get internet connection anytime in day and transaction can be possible
anytime without interruption.
Banks should give information about KYC norms in such way that people
can understand.
There is need to organize gramsabha, ratrisabha and awareness camps in
the village.
BC should be launched in the village by bank in a big gathering and in the
presence of affluent persons of village like Sarpanch, Talati, Post master
to give recognition to BC.
Branches have to develop such facility that account holder can access his
account from both bank branch as well as from BC.

Business Correspondent Model Under Financial Inclusion Drive 9

ABBREVIATION
BC: Business Correspondent
BCA: Business Correspondent Agent
BF: Business Facilitator
CPI: Consumer Price Index
DCCB: District Central Co-operative Bank
FI: Financial Inclusion
FIF: Financial Inclusion Fund
FITF: Financial Inclusion Technology Fund
GCC: General purpose Credit Card
GDP: Gross Domestic Product
GOI: Government of India
KCC: Kisan Credit Card
KYC: Know Your Customer
NABARD: National Bank or Agriculture and Rural Development
NRFIP: National Rural Financial Inclusion Plan
PACS: Primary Agriculture Credit Society
PPP: Purchasing Power Parity
RBI: Reserve Bank of India
RRB: Regional Rural Bank
SCC: Swarozgar Credit Card
SGB: Saurashratra Gramin Bank


Business Correspondent Model Under Financial Inclusion Drive 10

TABLE OF CONTENT


Sr.
No

TITLE

Page
No
1 Acknowledgement 4
2 Executive Summary 5
3 Abbreviations 9
4 Section 1 : Introduction 13
5 Section 2 : Background 22
6 Section 3: Methodology 24
7 Section 4: Findings of Study 27
8 Section 5 : Main Issues and Challenges 42
9 Section 6 : Suggestions for Improvement 44
10 Annexure 1 46
11 Annexure 2 48
12 Annexure 3 49
13 References 51





Business Correspondent Model Under Financial Inclusion Drive 11

LIST OF TABLES


Table No

TITLE
Page
No
1 No of Villages Allotted to Banks under Financial Inclusion
and bank uses various tools for cover this villages.
20
2 Number of villages having Population 2000 and above in
the Block of Surendranagar district.
22
3 No. of villages allotted to banks in different block in
Surendranagar district.
23
4 Detail of selected BC name, village, branch for whom he
works and block where branch situated for study.
25
5 BCs main and subsidiary occupation and no. of account
served by BC.
30
6 Details of Account served by BC. 31









Business Correspondent Model Under Financial Inclusion Drive 12

LIST OF FIGURES

Figure
No

Figure Title
Page
No
1 Financial Exclusion 16
2 Financial Inclusion 17
3 Gujarat State and Surendranagar District 24
4 BC working on POS Device 28
5 POS device 29
6 BC Occupation 31
7 Smart-card 32
8 Ratio of smart-card given and Operationalized 33
9 Marital Status of BC Client 35
10 No. of Account per Client Family 35
11 How People Aware about BC services 36
12 Clients Satisfaction towards BC services 37
13 Usage of Account by Clients of BC 37
14 Ratio of Account Holding by Non-Client of BC in other
Bank
38
15 Ratio of BC-service awareness in Non-clients 39
16 Reason for Not Availing BC service by Non-clients 40
17 Interest of non clients towards opening of account
through BC
40
18 Number of visit bank by non client in a year 41
19 Account holder gives her finger print for operating Account 42



Business Correspondent Model Under Financial Inclusion Drive 13

Section 1
INTRODUCTION

India has seen historic progress and growth in the past decade. In last 2 years
there is financial crisis in the world but India still holds its economy. India is the
eleventh largest economy in the world. India is second in population followed by
China. India stands third in purchasing power parity (PPP). India recorded
highest growth rate in mid-2000, and is one of the fastest growing economy in
the world. The growth is due to huge increase in size of middle class consumers,
a large labor force and heavy foreign investment. The growth story has been
impressive; although there are causes for concern on other dimensions.
Indias GDP rate during 2011-12 was 6.9% which has decreased from 8.4% in
2010-11. If we look at the sector wise participation in total GDP; service sector
contributes 59.1%, industry contribute 27.0% and agriculture contribute
13.9%. While service sector provide 34% and industrial sector provide 14% of
total employment, Agriculture, the major occupation in rural India, accounts
about 52% of total employment. Inflation (CPI) rate is 7.55% (May,2012)
There are 37% (2010) of the population lives in below poverty line, 9.8%
(2011) of population is unemployed, average gross salary is $ 1330 yearly
(2010) as per government of India figure. We have a long way to go in
identifying reasons of absolute poverty.
There are a large number of people in the country who have not accessed
formal financial system. Formal financial system has huge potential to provide
financial services to this excluded mass population. Low-income Indian
households in the informal or subsistence economy often have to borrow from
friends, family or moneylenders. They have little awareness and practically no
access to insurance products that could compensate/insure their life/assets in
unexpected circumstances such as illness, property damage or death of the
primary breadwinner.
Business Correspondent Model Under Financial Inclusion Drive 14

1.1 Financial Inclusion Brief History
India has deep root of financial inclusion. The Indian Government has a long
history of working to expand financial inclusion. In 1904 co-operative
movement has been started which was milestone in Indian economic history.
After independence the GOI adopted planned economic development for the
country. Accordingly, five year plans came into existence since 1951. 430
commercial banks were in the private sector those days. These banks are failed
to helping GOI in their social objectives. Thus, on 19
th
July, 1969 14 major
commercial banks were nationalized. It was a big step towards financial
inclusion. It has boost up the banking sector of India. In the same year National
credit committee (NCC) come with the concept of lead bank scheme which was
headed by Prof. D R Gadgil.
Narsimhan committee is conceptualized the foundation of regional rural banks in
India. The committee felt the need of 'regionally oriented rural banks' that
would address the problems and requirements of the rural people with local feel.
RRBs have been established in 1975 by Government of India with the same
aim. The main goal of establishing regional rural banks in India was to provide
credit to the rural people who are not economically strong enough, especially
the small and marginal farmers, artisans, agricultural labors, and even small
entrepreneurs. It encouraged branch expansion of bank branches especially in
rural areas. The RBI guidelines to banks show that 40% of their net bank credit
should be lent to the priority sector. This mainly consists of agriculture, small
scale industries, retail trade etc. More than 52% of our population depends
directly or indirectly on agriculture. So 18% of net bank credit should go to
priority sector.
In February 1992, SHG-Bank Linkage Programme has been launched by
NABARD as pilot project during the period of economic reforms in India which
was major initiative in financial inclusion. It proved to be a revolutionary
programme for alleviating poverty through capacity building and empowerment
Business Correspondent Model Under Financial Inclusion Drive 15

of the rural poor, especially women. Microcredit extended either directly or
through any intermediary is considered as part of banks priority sector lending.
The SHG-bank linkage programme provides opportunities for the rural poor to
participate in the development process. It is cost effective, and ensures that
more and more people are brought under sustainable developmental activities,
within a short span of time. NABARD assistance to SHGs across the country has
resulted in 47.87lakh SHGs being credit linked by March 2011. The programme
has enabled estimated 9.7crore poor households to gain access to micro finance
from the formal banking system as on March 2011. Thus, it has an important
role in promoting financial inclusion and inclusive growth.

The Kisan Credit Card (KCC) scheme was introduced in 1998. It provides timely
and hassle free short term loans. As on 31
st
March 2012, 1139.1lakh KCCs had
been issued. The Swarozgar Credit Card (SCC) Scheme was introduced by
NABARD in 2003 for facilitating hassle free credit for meeting investment and
working capital requirements of small borrowers and rural micro-entrepreneurs.
As on 31
st
March 2012, the banking system had issued 13.06lakh cards
involving credit limits of Rs.5445.32crore.
Recent simplification of KYC norms is another milestone. With the directive from
RBI, banks are now offering No Frill accounts to low income groups. These
accounts have a low minimum or nil balance. It comes with the concept of
business correspondent in 2006. Financial inclusion is an attempt to bring larger
community under the umbrella of formal credit and alleviate poverty in rural
areas.
What is Financial Inclusion
There are many different definition of financial inclusion. Financial inclusion or
inclusive growth is the availability of banking services at an affordable cost to
disadvantaged and low-income groups. Opposite of financial inclusion is
financial exclusion. A group or person which can be consider as financially
Business Correspondent Model Under Financial Inclusion Drive 16

excluded if they do not have access to formal financial services such as banking
facility.

Source: Finance for All? Policies and Pitfalls in Expanding Access, World Bank
Report, 2008
Figure 1: Financial Exclusion
In India most of people not aware about FI and the people who know think that
FI is having a saving or current account with any bank. But it is not only savings
and current account; it also includes Credit, loans, remittance, insurance
services, pension plans and many more services.
Population
Non user of
formal
financial
services
Involuntary
exclusion
Ineligibility
Non
availability/dis
crimination
Financial
illitiracy
Non
affordability/
Others
Voluntary self
exclusion
No need
Cultural
religious
barriers/indire
ct access
User of formal
financial
services
Business Correspondent Model Under Financial Inclusion Drive 17


Figure 2: Financial Inclusion
India stands 50th amongst 100 countries in index of financial inclusion to find
out the extent of reach of banking services. Only 34% of Indian individuals have
access to or receive banking services. The main reason for not using financial
services is the lack of a regular income and not enough savings. Another reason
is proximity of the financial service. The loss is not only the transportation cost
but also the loss of daily wages for a low income individual. The customers who
are excluded are totally unaware about benefits of financial services provided by
banks. They borrow money from money lenders; friends and relatives to fulfill
their financial requirements. They find it easier to approach them than to banks.
Banks asks for collateral against loan which is difficult to provide for low income
group even lot of paper work need to be done, keep them away from banking
system. Lack of awareness about financial services on the part of villagers and
bankers traditional thinking is the main hurdle in it. It seems to lack of financial
literacy.
Financial
Inclusion
Savings
Insurance
Payment
and
Remittance
Affordable
Credit
Financial
advice
Bank
Accounts
Business Correspondent Model Under Financial Inclusion Drive 18

1.3 Financial literacy
Financial literacy means great awareness, impart knowledge and upgrade skills
to make financial decisions about savings, investments, borrowings and
expenditure in an informed manner. Financial literacy is a primary step for
financial inclusion since introspection changes behavior which in turn makes
people seek and receive financial services and products. Financial literacy is
instrumental in expanding financial inclusion, which in turn is helpful in further
expanding financial literacy, thus, mutually reinforcing each other in a positive
manner. NABARD is working with various agencies like the Indian School of
Microfinance for Women and all banks to enforce financial literacy in rural areas.
It has identified state level partners to make the financial literacy plan
successful.
1.4 Financial Inclusion Fund
In June 2006, GOI constituted a Committee on Financial Inclusion under the
chairmanship of Dr. Rangarajan to look into the problem of exclusion of rural
poor from access to financial services. Based on recommendation of committee
two fund (the Financial Inclusion (Promotion and Development) Fund (FIF) and
the Financial Inclusion Technology Fund (FITF)) were set up with NABARD. The
funds are meant for meeting the cost of developmental and promotional
interventions, and costs of technology adoption, respectively. The funds will
have an initial corpus of Rs.500crore with initial funding of Rs.250crore each, to
be contributed in 40:40:20 proportion by GOI/RBI/NABARD. Funding from FIF
would be available for various promotional and developmental initiatives to
facilitate better credit absorption capacity among the poor and vulnerable
group. The fund for FITF would be extended to enable application of low cost
technology solution and rolling out IT based inclusive financial sector plan.
Still financial inclusion plan is not implemented properly in every part of
country. Banks are still struggling to achieve ultimate goal of Financial
Business Correspondent Model Under Financial Inclusion Drive 19

Inclusion. The main reason could be lack of financial literacy among people that
they do not trust the concept. The provision of uncomplicated, small, affordable
financial products will help to bring the low income families into the formal
financial sector.
Banks have limitations to reach directly to the low income consumers. Hence,
Banks can use business correspondent (BC) or business facilitator (BF) who can
be considered as an excellent channel to distribute bans product and
disseminate information about other banking services. BC can also aware
people about financial inclusion plan and educate them about money
management which will be useful for banks to attract low income group, to
facilitate financial inclusion.
1.5 Business facilitator (BF) and Business correspondent (BC) Model
It is not possible for banks to open brick and mortar branches in every village
as it is not economically viable. Banks have to find out alternate ways to cover
all the villages under financial inclusion. They have adopted Mobile van facility,
ultra small branches and BCA model for providing financial services to financially
excluded rural population.
With the objective of ensuring greater financial inclusion and increasing the
outreach of the banking sector, Reserve Bank of India has instructed banks to
use the service of Non-governmental organization/ Self-help groups (SHGs /
NGOs), Microfinance institutions (MFIs), and other Civil Society Organizations
(CSOs) as intermediaries in providing financial and banking services through
Business Facilitator and Business Correspondent models.
BC can be
Individual/kiranna/medical/fair price shop
Agent of small saving schemes of GOI/Insurance companies
Individual public call office operators(PCO)
Business Correspondent Model Under Financial Inclusion Drive 20

Individual who own petrol pumps
Retired teacher
Authorized functionaries of well own SHGs
Operations common service centers (CSCs)
Farmers club
Different banks adopt different models likewise some banks have appointed
individual as BC/BF and some banks appointed agency/corporate body as
BC/BF.
Table 1: No of Villages Allotted to Banks under Financial Inclusion and bank
uses various tools for cover this villages. (SLBC Review, Gujarat)
Sr.
No. Name of Bank
Total No
of
villages
allotted
to the
bank
Achievement up to March 2012 Total no
of
villages
covered
up to
31-3-
2012
Through
brick &
mortar
branch
model
Through
ultra small
branch
opened
Through
BCA
appointed
Through
mobile
van
1 Allahabad Bank 2 0 0 22 0 2
2 Bank of Baroda 733 17 650 60 6 733
3 Bank of India 191 3 0 187 1 191
4 Bank of Maharashtra 16 1 0 15 0 16
5 Canara Bank 2 0 0 2 0 2
6 Central Bank of India 168 1 0 167 0 168
7 Corporation Bank 8 0 0 8 0 8
8 Dena Bank 493 24 23 446 0 493
9 Indian Bank 14 0 0 14 0 14
10 Indian Overseas Bank 26 0 0 26 0 26
11 Oriental Bank of Commerce 3 0 0 3 0 3
12 Punjab National Bank 23 3 0 20 0 23
13 State Bank of India 903 8 0 895 0 903
Business Correspondent Model Under Financial Inclusion Drive 21

14 Syndicate Bank 11 11 0 0 0 11
15 UCO Bank 26 0 0 17 9 26
16 Union Bank of India 133 6 0 127 0 133
Subtotal of PSB's 2752 74 673 1989 16 2752

1 Developmental Credit Bank 1 0 0 1 0 1
2 DFC 2 0 0 2 0 2
3 Kotak Mahindra Bank 2 0 0 2 0 2
Subtotal of Private Bank's 5 0 0 5 0 5

1 Dena Gujrat Gramin Bank 245 7 0 238 0 245
2
Baroda Gujarat Gramin
Bank 350 2 0 348 0 350
3 Saurashtra Gramin Bank 139 7 0 132 0 139
Subtotal of RRB's 734 16 0 718 0 734

1 Ahmedabad DCCB 2 2 0 0 0 2
2 Amreli DCCB 1 1 0 0 0 1
3 Mehsana DCCB 2 2 0 0 0 2
4 Sabarkantha DCCB 6 6 0 0 0 6

Subtotal of Co-operative
Bank's 11 11 0 0 0 11

Total 3502 101 673 2732 16 3502
Source: SLBC, Gujarat Agenda & Background Papers for 133
rd
State Level
Review Meeting Year Ended March-2012



Business Correspondent Model Under Financial Inclusion Drive 22

Section 2
BACKGROUND
The report presented here on request of NABARD, regional office, Gujarat to
figure out the impact of Business Correspondent (BC) Model under Financial
Inclusion (FI) Drive. The BC has been appointed under financial inclusion plan.
The villages which are above 2000 population are included in financial inclusion.
Surendranagar district of Gujarat has been selected for study.
Table 2: Number of villages having Population 2000 and above in the Block of
Surendranagar district
Block Village
Muli 11
Limbdi 19
Drangadra 20
Chuda 12
Wadhwan 19
Chotila 6
Halwad 16
Lakthar 4
Patdi 11
Sayla 9
Total 127

In Surendranagar district average number of villages served by the bank
branches is 8.6villages/ bank branch.
87 Commercial bank branches
31 RRB branches
13 DCCB branches
346 PACS as on March 2011
Business Correspondent Model Under Financial Inclusion Drive 23

The existing building structure has covered 254011 household ou of 277667 in
650 villages of surendranagar district through KCC/GCC
Surendranagar has achieved 100% financial inclusion in MAY 2008. In 2010-11,
127 villages have been identified with population more than 2000 but not
having banking facility in all 10 blocks.
Table 3: No. of villages allotted to banks in different block in Surendranagar
district
No of Villages
having 2000
and above
population
allotted to
Bank (to be
covered
between
1April 2010 to
31 March
2012)




Block wise village with over 2000 population
Name Of Bank Chotila Chuda
Dhranga
dhra
Halvad Lakthar Limbdi Muli Patdi Sayla Wadhwan Total
SBI
1 8 4 9 1 8 5 6 0 7 49
SGB 4 2 4 4 0 7 6 2 0 5
34
Dena Bank 1 0 3 3 0 3 0 3 8 3
24
PNB 0 2 2 0 0 0 0 0 1 1
6
CBI 0 0 2 0 1 0 0 0 0 1
4
Union Bank 0 0 2 0 0 0 0 0 0 0
2
BOB 0 0 3 0 0 0 0 0 0 1
4
BOI 0 0 0 0 0 0 0 0 0 1
1
Syndicate Bank 0 0 0 0 0 0 0 0 0 1
1
HDFC 0 0 0 0 2 0 0 0 0 0
2
Total
6 12 20 16 4 18 11 11 9 20 127

SBI and SGB have maximum number of branches in Surendranagar district. SBI
is lead bank in Surendranagar district as well as sponsored bank of SGB. SGB
has adopted CBS platform provided by C-edge Technology Ltd. for their bank
branches. SGB has added 3375 rural household accounts during the year
(1/4/2011 to 31/3/2012). They have future target of 6525 household accounts.

Business Correspondent Model Under Financial Inclusion Drive 24

Section 3
METHODOLOGY
3.1 Area selection for data collection

Figure 3: Gujarat State and Surendranagar District
The requirement of the project is to find out working of BC model.
Surendranagar district has been selected for collection of data in Gujarat state.
Surendranagar district has been selected because in Gujarat Surendranagar
district has done good work in BC model under financial inclusion. Data has
been collected from four blocks of Surendranagar.
3.2 Selection of bank
For collection of primary data Regional Rural Bank was selected. In
Surendranagar, Saurashtra Gramin Bank is major RRB. So, five SGB branches
were selected for primary data collection.
3.3 Selection of village and BC
Villages have 2000 or above population were selected for data collection. 10
villages of four Block were selected where 10 BC has been appointed from SGB
branch bank.
Business Correspondent Model Under Financial Inclusion Drive 25

Table 4: Detail of selected BC name, village, branch for whom he works and
block where branch situated for study
Sr.
No.
Name of BC
Name of the
Village in
which BC is
working
Name of the
Branch
Name of
Block
1 Gopalsinh Dodia Digsar Sekhpar
Muli
2 Nilesh Vitthapara Danawad Sekhpar
3 Chaganbhai Oghadbhai Patel Kholadiyad Wadhwan
Wadhwan
4 Parthbhai Gediya Fulgram Rampara
5 Kamleshbhai ishwarebhai Rathod Rawaliyavadar Mota Ankevaliya
Dhangadhra 6 Amrutbhai Mansukhbhai lakum Gujarvadi Mota Ankevaliya
7 Rameshbhai Bhikhabhai Parmar Devcharadi Mota Ankevaliya
8 Bharatbhai Sandabhai Dharjiya Parnala Jambu
Limbdi 9 Ibrahambhai Abdulbhai bhathaniya Bhathan Jambu
10 Rameshbhai Mansinhbhai Vadekhanioya Nana timbla Jambu

3.4 Selection of Client and Non-client of BC
Clients are using services from BC while Non-clients are not using BC services.
From every village 10 client availing BC facility and 5 clients not using BC
facility were selected.
3.5 Collection of primary data
Primary data has been collected to find out of different models and patterns
opted by banks. Pros and cons in implementation of BC/BF model for bankers
and the gap between the expectation of all partners i.e. BC/BF, Banks and
villagers. Questionnaire was prepared for BCs client, non-client, BC themselves
and bank branches.
1. Questionnaires for Clients
2. Questionnaires for non-clients
Business Correspondent Model Under Financial Inclusion Drive 26

3. Questionnaires for BC
4. Questionnaires for Bank branch
(Refer Annexure 1, 2 ,3 )
Other details were collected from District administrative office, district lead bank
and region office of Saurashtra Gramin Bank. Data was collected by asking open
ended questions and try to get details. Additional information was collected
from NABARD officers and DDM through interaction.
3.6 Secondary Data collection
Secondary data has been collected from different literature about financial
inclusion and business correspondent model. It has also been accessed from
different RBI reports, speeches, research work, etc. and from internet.
3.7 Data Analysis
The data collected are analyzed and summary statistics are presented in tables
and graphs.










Business Correspondent Model Under Financial Inclusion Drive 27

Section 4
Finding of Study
4.1 Impact of BC model on Bank branch
All the branches of SGB in Surendranagar have been included under financial
inclusion. They are all linked with core banking solution. Some branches have
been providing locker and SMS alert facility. In Surendranagar total 35 villages
has been covered by SGB through BC service. All Bank branch has been
adopted KYC norms for persons who wanted to open account through BC. They
are asking photo for photo identity, ration card or license for residential proof.
Problems faces by bank branches for implementation of financial inclusion plan:
According to bank branches, lack of awareness among village people about
benefits of holding an account in bank is a major problem. They do not have
enough savings. Time is another issue for villagers. KYC norms are also
sometime problem. In villages generally we have seen that persons have two
different names in two different documents. In such case, banks are not
approving these persons even after written letter of affidavit given by Talati or
Mantri.
Bank staff does not have proper understanding of concept of FI, Hence they are
not able to extend required support for FI initiatives. There is communication
gap between bank and BC.
Suggestion by bank branches: According to branches if they can be provided
with mobile van facility they can improve in FI plan. Cash limit, which was given
to BC, should also increase. They also ask for improvement in devices which will
help BC face fewer problems. There is need great awareness even among
bankers and establish forum where banks will have continuous interaction with
BCs.

Business Correspondent Model Under Financial Inclusion Drive 28

4.2 Impact of BC model on BC
Banks have selected BCs who are engaged with bank in the past. The selected
BCs are well aware of bank services. Banks gave training to BCs after selection.
In training they learn how to use POS device and how to solve basic device
related problems. All the BCs who selected are serving in their own village. They
are available 24 hours in their village and provide services all 7 days of week.
Some BCs have been engaged to cater two villages but they have not started
working in other village due to transaction problems in POS device.

Figure 4: BC working on POS Device
Business Correspondent Model Under Financial Inclusion Drive 29

Functioning of POS device:BC open an account of customer through POS device
which is directly connected to branch server through internet. BC gives receipt
to account holder for their each transaction. After opening of account with BC
client get smart-card. Smart-card is the only way to access account which was
opened by BC. BC has also got one smart-card for his identification. After
inserting both BCs and clients smart card BC can access account.

Figure 5: POS Device
BCs got webcam and fingerprint identifier along with POS device. For opening of
account BC take photo and fingerprint of client. This identity used as the proof
for opening of account. When account holder want to access his account,
fingerprint is required for identification.




Business Correspondent Model Under Financial Inclusion Drive 30

4.2.1 Details of BC
Table 5: BCs main and subsidiary occupation and no. of account served by BC
Sr.
No.
Name of BC
Name of the
Village in which
BC is working
Occupation No of
a/c
served
Main Subsidiary
1 Gopalsinh Dodia Digsar
Agriculture,
BC
Car Give On
hire
40
2 Nilesh Vitthapara Danawad Student BC 12
3 Chaganbhai Oghadbhai Patel Kholadiyad
Agriculture,
BC
Drip
consultant
60
4 Kamleshbhai Ishwarebhai Rathod Rawaliyavadar
BC,
Agriculture
Shop 184
5 Amrutbhai Mansukhbhai Lakum Gujarvadi Job, BC Dairy 48
6 Rameshbhai Bhikhabhai Parmar Devcharadi Handicraft
Agriculture,
BC
40
7 Parthbhai Gediya Fulgram BC Shop 40
8 Bharatbhai Sandabhai Dharjiya Parnala Agriculture BC 38
9
Ibrahambhai Abdulbhai
Bhathaniya
Bhathan Agriculture BC 40
10
Rameshbhai Mansinhbhai
Vadekhanioya
Nana timbla Agriculture Shop, BC 34

BCs are doing their work of BC along with their other occupation. The
percentage of their occupation as BC and Under other income generating
activity can be seen from Table 5.
Business Correspondent Model Under Financial Inclusion Drive 31


Figure 6: BC Occupation
As per Figure 6 we can see that about 60% of BC have taken up BC business as
subsidiary occupation and 40% of BC have taken up BC as main occupation.
From this 40%, most of them are also engaged with other occupation like
agriculture. So, it is important to do something for them to get more interest in
BC occupation.
Table 6: Details of Account served by BC
Sr.
No.
Name of the CSP
Name of
Village
No of
a/c
served
by BC
Savings
In-
operativ
e a/c
No of
a/c
Amount
1
Gopalsinh Dodia Digsar 40 40 100000 25
2
Nilesh Vitthapara Danawad 12 12 2400 8
3
Chaganbhai Oghadbhai Patel Kholadiyad 60 60 - -
4
Kamleshbhai Ishwarebhai Rathod Rawaliyawadar 184 184 50000 80
5
Amrutbhai Mansukhbhai lakum Gujarvadi 48 48 500 37
6
Rameshbhai Bhikhabhai Parmar Devcharadi 40 40 10000 30
7
Parthbhai Gediya Fulgram 40 40 0 30
40%
60%
As Main
As Subsidiary
Business Correspondent Model Under Financial Inclusion Drive 32

8
Bharatbhai Sandabhai Dharjiya Parnala 38 25 50000 10
9
Ibrahambhai Abdulbhai bhathaniya Bhathan 40 40 15000 5
10
Rameshbhai Mansinhbhai Vadekhanioya Nana Timbala 34 34 5000 10

Average 54 52 25878 26

Average account open by BC is 54, which goes from 12 to 184. There is big
difference between the average value and lowest no of a/c opened. Average
saving account open is 52 where average 26 accounts are inoperative which
varies from 5 to 80. Average amount in saving accounts served by BC is Rs.
25878/- which varies from Rs. 0/- to Rs. 100000/-.
4.2.2 Remuneration given to BC
BC is getting Rs. 2000/- per month as fixed salary. They have also committed
to get Rs. 1/- per transaction. It means that when customer does any
transaction through POS device like deposit or withdrawal, he will get Rs. 1/-.
But BC has not got any transaction commission yet because the POS device is
not working properly. BC is also getting about Rs. 2.50/- per kilometer as
conveyance charges.
4.2.3 Smart-Card

Figure 7: Smart-Card
Business Correspondent Model Under Financial Inclusion Drive 33

Smart card is used for accessing the account to make any transaction. As shown
in figure 8 we can conclude that 30% of BC could not get smart-card. 70% of
BC has got smart card but not for all their clients. They got smart card for half
or less than half account holder. From these 70% only 14 % of smart cards
were operationalized. So we can conclude that, 86% of the smart cards issued
are not operationalized which means that BC clients are not able to access their
account through POS device.
First, acquiring smart cards by clients is a problem while accessing it being next.
The main problem for not properly using smart card is POS device problem and
network connectivity problem.

Figure 8: Ratio of smart-card given and Operationalized
BC has been given Rs. 10000/- to Rs. 25000/- transaction limit per day. There
is also limit of transaction per account which is Rs. 5000/- to Rs. 10000/- per
day.



Business Correspondent Model Under Financial Inclusion Drive 34

4.2.4 BCs View for FI and BC Model
BC is the grass root channel of financial inclusion plan. He is directly concerned
with grass root level problems. He is one who actually knows what people want.
He is directly related with villagers and is also one amongst them. BC suggest
following points for improvement of FI plan
Increase cash limit
Smart-card should be available to A/C holder as quick as possible or
within week
Solve device problem as soon as possible and issue device(Who are
still not getting)
Give sim-card of mobile service provider which has good network
connectivity in village
Transfer of old branch account to BC
Give liberty in KYC norms
Transaction should be done from both bank and BC
Account opening form should be given to BC from bank
Workshop for awareness should be done
Advertisement of BC should be done
Check can be accepted by BC
FD should be done by BC
4.3 Impact of Clients
The clients which served by BC are most by married. As per the data (figure 9)
88% of the clients are married and 12% of the clients are unmarried. The study
shows that clients who have accounts are mature enough. They have
responsibility of their family.
Business Correspondent Model Under Financial Inclusion Drive 35


Figure 9: Marital Status of BC Client
The average number of adult member in their family is 4 i.e., 2 man and 2
woman. The average number of accounts in clients family is 2 which are lies
from 1 to 7 accounts. As we can see in figure 10 that 47 clients hold only one
account in their family and which were opened through BC. 32 clients have 2
accounts and 14 clients have 3 accounts. Additional accounts have opened
earlier before BCs services were available in village.

Figure 10: No. of Account per Client Family
88%
12%
Married
Unmarried
47
32
14
0
4
1 1
1 2 3 4 5 6 7
N
o
.

o
f

C
l
i
e
n
t
No of Accounts
Business Correspondent Model Under Financial Inclusion Drive 36

4.3.1 Awareness issues among clients
The villagers are not aware about the services provided by banks and BC.
Because of their illiteracy they do not understand the concept of financial
inclusion. Very few people are aware of BC model and FI. Due to lack of time
they do not got chance to understand concept. They are working whole day in
farm or any other occupation which they are engaged. Sometimes they are
aware about services but cannot adopt it because of limiting factor availability
of time.

Figure 11: How People Aware about BC services
It may be observed from figure 11 that about 96% of people know about BC
service in their village through BC himself. It shows that the requirement of
more awareness camp like gram sabha, ratri sabha is needed. It should be
required to aware people about FI. They should trust in BC model by their own.
They should understand importance of savings. It is only possible if they get
aware by themselves.
4.3.2 Satisfaction of client
BCs are concerned with money. They hold money of villagers. It must require
having trust in BC. If trust factor is not in BCs then BCs cannot work properly in
96
2 2
Through BC Workshop Other
Business Correspondent Model Under Financial Inclusion Drive 37

village. Trust can be earned by the satisfaction of work. If BC satisfies needs of
villagers they can easily trust him and also support him for improvement.

Figure 12: Clients Satisfaction towards BC services
From figure 12 we can see that 90% of people are satisfied with BCs services.
10% people are not satisfied. But from this 10% of people most of them have
complaints with device and not with BCs. The problems are mainly related to
smart card availability or inadequate infrastructure accessibility. The BCs are
working well in their villages; they are able to satisfy needs of their clients
which shows healthy growth of FI.

Figure 13: Usage of Account by Clients of BC
90%
10%
Satisfied
Unsatisfied
83%
17%
Operative
Inoperative
Business Correspondent Model Under Financial Inclusion Drive 38

83% of accounts are operative while 17% of accounts are inoperative (figure
13). But here all the transaction has done through bank branch by BC visiting
branch physically.
4.4 Impact of Non-Client
Non-clients are the persons who are not using the service provide by BC. Some
villagers are not using BC services because of various reasons. The non clients
are mostly engaged with agriculture and other occupation like agriculture
labour, diamond related works, shops, etc.

Figure 14: Ratio of Account Holding by Non-Client of BC in other Bank
The non-clients are also holding account in other bank or branch bank. About
78% of the non-clients have bank account while 22% do not have any bank
account (figure 14). They are totally eliminated from formal financial sector. The
reason for exclusion is lack of time and do not possess enough savings. We can
also count illiteracy of people as another reason for not opening of bank
account.
4.4.1 Reason for not availing account by villagers
There are many reasons for not opening account through BC. 16% of people are
not aware about the service provided by BC.
78%
22%
Yes
No
Business Correspondent Model Under Financial Inclusion Drive 39


Figure 15: Ratio of BC-service awareness in Non-clients
About 34% of non-client populations are not availing BC service because they
do not trust the concept of BC. They are aware of BC services but somehow
they are very possessive and concerned with their money. These groups of
people do not trust anyone quickly. 14% of people think that this facility is not
convenient for them. This group of people is mostly migrating from one place to
other place frequently. They are not staying in one place for long time. It is
difficult for them to come to village for only accessing the account. 12% of
people are not joining with BC because of limit fixed for transactions. These
group of people are have some more amount of transaction occurs. They are
taking crop loan or getting any government subsidy. These people have larger
amount for withdrawal and BC has limit on cash for their transaction. 24% are
the groups of people who have other reasons for not using BC services which
are given below:
84%
16%
Aware
Not Aware
Business Correspondent Model Under Financial Inclusion Drive 40


Figure 16: Reason for Not Availing BC service by Non-clients
Account holding in main branch
Availability of time
Due to device problem
Document problem
Not enough savings

Figure 17: Interest of non clients towards opening of account through BC
Not Aware Don't trust the
concept
Not convinient Limit of
Transaction
Other
16%
34%
14%
12%
24%
Reason for not availing BC service
68%
32%
Interested
Not interested
Business Correspondent Model Under Financial Inclusion Drive 41

As per figure 17 we can see that 68% people are interested for opening of
account with BC. They think that it is easy for them and also convenient for
them to get bank facility from their village itself. Here, 32% of people are not
interested in opening of account in BC. This group of people are most of migrate
from one place to the other and others have already account in main branch.

Figure 18: Number of visit bank by non client in a year
Figure 18 shows the frequency of visit of bank by the non-clients. The study of
50 people shows that 13 people never visit banks. 16 had visited bank 1 to 2
times in a year only for making sure that their account is not closed.






0
2
4
6
8
10
12
14
16
18
Never 1 to 2 3 to 4 5 to 6 7 to 8 9 to 10 11 to 12 >12
P
e
r
s
o
n
s
Times for visit the Bank(per year)
Business Correspondent Model Under Financial Inclusion Drive 42

Section 5
MAIN ISSUES AND CHALLENGES
The study of Business correspondent model shows some facts about BC model
in villages. We have seen some findings about the model. Here we discuss
about constrains that why FI plan still not successful. The results of the findings
had been discussed here.
1. Device
First of all the POS device has not been given to all the BC and the POS
devices which was given to the BCs are faulty. POS device do not work
properly.

Figure 19: Account holder gives her finger print for operating Account

Device has two parts which identify customer. One is web cam and another is
fingerprint identifier. Fingerprint identifier is some times not working it
requires cleaning on regular basis.


Business Correspondent Model Under Financial Inclusion Drive 43

2. Smart Card
Smart card is another issue. BC opens the account of customer through POS
device. Once the account opened it require smart card for operating it. As
shown in above figure 19 for operating of customers accounts both
smartcard of clients as well as BC are required. But the problem is that after
opening of account smart card has been issued after 1 or 1.5 month later. So
if the customer wants to execute immediate transaction he/she cant do that.
3. Connectivity (Network)
POS device is wireless electronic instrument which works on battery. For
operating the device it requires internet connectivity. For this internet
connectivity, they are availing the services of mobile service provider. In the
village and remote area there is problem of network connection. Without
network POS device cannot connect to internet and hence, the transactions
are not materializing.
4. Document
The documents required for opening of bank account are photo identity and
residence proof. In villages studied it was observed that, a person has two
different names in two different documents because of their illiteracy. As per
KYC norms it is not acceptable. This is corning in the way of FI.
5. Awareness/Acceptability
In villages, generally people cant accept new things easily or quickly. People
do not trust the BC and when we are talking about money it is hard to
convince people. They also dont have clear idea about what financial
inclusion exactly is; hence, financial literacy campaigns are necessary in the
villages. Recognition should be given by bank to BC as banks representative
in a village.
6. Account holding at main branch
Villagers have small savings. They are opening savings account for their
small savings. For this they have to go to branch for transaction or any kind
of other banking facility which cost him wages for that day and
transportation. Service of BC is given at the door step but they cannot open
account there because they are already account holder in branch.
Business Correspondent Model Under Financial Inclusion Drive 44

Section 6
SUGGETION FOR IMPROVEMENT
1. Device
POS device should be given to BC as quickly as possible. The technical
problem regarding to device should be solved with the help of expert.
Training should be given to BC for helping them to understand device easily.
2. Smart card
Smart card is necessary for transaction of individual account. Smart card
should be issued to client within week of opening account. So, account holder
can use his account and make transaction possible. Transaction should be
made possible from both BC and branch through same smart card.
3. Connectivity(Network)
In remote rural area it is not possible to get connectivity from all mobile
service providers. Smartcard which is given to BC should have good network
connectivity within the village. This will enable the BCs to get internet
connection anytime in day and transaction can be possible anytime without
going here and there.
4. Document
Due to illiteracy in rural areas document is major problem. Bank follows its
KYC norms for opening of account. The villagers cannot get banking facility
just because of some mistake in document. Banks have to make their KYC
rules easier for such kind of people. Banks should get confirmation from BC
or can get written later from them.
5. Awareness/Acceptability
The villagers cannot get benefit of many government schemes or such kind
of banking facility just because of they are not aware of facility. There is
need to organize gramsabha, ratrisabha and awareness camps in the village.
The announcement of BC facility in the villages should be done by some high
level banking authority or a person who is trusted by the people in that
village. So that credibility gap can be reduced.

Business Correspondent Model Under Financial Inclusion Drive 45

6. Account holding in main branch
Branches have to develop such facility that account holder can access his
account from both bank branch as well as from BC.
















Business Correspondent Model Under Financial Inclusion Drive 46


ANNEXURE
Annexure 1
Questionnaires for BC

1. Bank:
2. Name of CSP:
3. Occupation
a. Main: b. Subsidiary:
4. Name of BC:

5. Name of Branch:

6. Name of village in which CSP is residing:

7. Name of village served by CSP:

8. No. of A/C served by CSP:

9. No. of hours CSP is available in each village:

10.Weather Smartcard has been issued & operationalised? YES/NO

11.If yes, product offered?
a. Deposit
1. Recurring deposit 2. Fixed deposit
b. Overdraft
c. Micro-credit
Business Correspondent Model Under Financial Inclusion Drive 47

1. GCC 2.KCC/SCC/JLG 3. Any
other
d. Remittance
e. Govt. payments
1. MANREGA 2.Old Age Pension 3. Widow pension
4.Any other
f. Private payment
1. From a/c holders 2. From others a/c to a/c 3.Any
other:
g. Micro pension
1. Swaviman (NPS) Scheme 2.Any other
h. Micro insurance
i. Life insurance
1. Collection of premium 2.Payment of claim
j. Non-life insurance
1. Asset insurance 2.Health insurance 3.Crop insurance 4.Any other

12. If No, What are impediments?
a. Smart card are not issued
b. POS device is yet to be made operational
c. Any other



13.No of transaction per day (AVG for a month):
14.No of transaction per account (AVG for a month):
15.Limit on cash payment per a/c per day:
16.Limit on cash payment per day:
17.Remuneration received per transaction:
18.What other products can be offered through smart cards?


Business Correspondent Model Under Financial Inclusion Drive 48


19.No. of a/c opened and amount involved since opening of the outlet as CSP as
on date of survey
a. Name of village:
b. Savings
1. No. of a/c: 2.Amount:
c. Micro credit
1. No. of a/c: 2.Amount:
d. Inoperative a/c:

20.Suggestion from CSP for improving the facilities under FI:

Annexure 2
Questionnaire for BCs Client
1. Block:
2. Bank:
3. Name of village:
4. Name of Head Of Family:
5. Married: YES/NO
6. No. of adult member in family:
a. Male b. Female
7. Details of Account
a. No. of A/C:
b. Operative/Inoperative:
8. How he has come to know about Facilitates available from Bank/CSP
a. Through BC/CSP c. Workshops
b. Through NGO d. Any Other
9. Types of facilities availing of from BC/CSP please indicate branch CSP/NONE
a. Deposit Accounts d. Loan Accounts
b. Remittance e. Micro-insurance
Business Correspondent Model Under Financial Inclusion Drive 49

c. Pension f. Any Other
10.Weather the CSP/BC resides in the village and accessible any time? YES/NO
11.If CSP/BC resides in other village? YES/NO
12.How many hours in a day he is available? :
13.Are there any fix timings? YES/NO
14.How many days in a week the CSP/BC is available? :
15.Weather account holder is happy with the services offered by the CSP/BC?
YES/NO
a. If no what are his expectation from CSP/BC

16.Weather satisfied with bank facility? If yes what makes him happy?
a. Deposit- door steps services/Prompt payment
b. Micro credit-sanction of adequate amount of loan/less documentation
c. Remittance-reasonable service charges/prompt service
d. Micro insurance-affordable premium/prompt settlement of land
e. Pension affordable premium/simple documentation/prompt settlement
of claim
f. Other-prompt payment/personalized service
17.If not satisfied with bank facility please indicate reason and also indicate
what facility he wants?


18.Any other information, account holder wants to give for the betterment under
financial inclusion facilities?
Annexure 3
Questionnaire for Non-Client
1. Block:
2. Bank:
Business Correspondent Model Under Financial Inclusion Drive 50

3. Name of village:
4. Name of Head Of Family:
5. No. of adult member in family:
a. Male: b. Female:
6. Occupation:

7. Details of Account
a. No. of A/C: b. Operative/Inoperative:

8. Whether a member of any SHG/JLG? :

9. How many times visits the bank (say in a month)? :

10. Types of facilities availing of from Bank/Other/From where are following
facilities availed?
a. Deposit Accounts d. Loan Accounts
b. Remittance e. Micro-insurance
c. Pension f. Any Other

11.Weather aware about the services provided by CSP/BC? : YES/NO

12.Reasons for not availing the services of BC/CSP
a. Not aware of services offered
b. BC available when required (Availability)
c. BC/CSP resides in another village (Accessibility)
d. The BC is not approachable/doesnt trust the concept (Acceptability)
e. Does not find it convenient
f. Limits on Transaction
13.If interested in availing the services of the BC/CSP? : YES/NO


Business Correspondent Model Under Financial Inclusion Drive 51

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2. Central, B I S. 2011. K C Chakrabarty: Banking and beyond new
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3. Indian Institute Of Banking & Finance. 2009. Inclusive Growth.
4. K.C.Chakrabarty. Financial Inclusion | A road India needs to travel. Media.
(http://www.livemint.com/2011/09/21211250/Financial-Inclusion--A-road-
I.html).
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Sahoo. 2009. Financial Inclusion-An Overview,NABARD
6. Nair, Remya.Business correspondent model to be changed to aid inclusion.
(http://www.livemint.com/2012/02/01235004/Business-correspondent-
model-t.html).
7. Roy, Dr Debesh. 2011. sRetrieved August 20, 2012
(http://iobbancon2011.com/uploads/CEDocuments/Compdm/Article23.pdf).
8.Shreela Manoj. What is Financial Inclusion.
(http://www.chillibreeze.com/articles_various/Indian-Finance.asp).