Presentation by: Mr. B. Samba Murthy Director, IDRBT. Website: www.idrbt.ac.in Email: bsambamurthy@idrbt.ac.

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INSTITUTE FOR DEVELOPMENT AND RESEARCH IN BANKING TECHNOLOGY

RBI-OECD Workshop

Delivering Financial Literacy

March22-23, 2010. Bangalore

Established by RBI in 1996 for promoting use of technology in Banking Sector.

MISSION

Explore and Exploit technology for common good

FINANCIAL EXCLUSION A FEW DIMENSIONS

Over 100 Million house holders had no formal access to credit. Nearly 600 million new accounts to be opened. Out of 6,25,000 villages there are bank branches only in about 30,000 villages.

REAL CHALLENGE

Provide basic financial services to over 300 million excluded people spread over 600,000 villages.

Use of I.T. is inevitable to provide access to formal Banking services.

BUSINESS NEEDS
Increase outreach Scale up number of users Reduce Opportunity cost/time Ensure Reliability Integrity of Account and Information Ensure Security High Degree of Assurance Inter-operability

ROLE OF IDRBT IN FINANCIAL INCLUSION

Encourage Banks to develop an appropriate ICT platform. Facilitate development of common and inter-operable standards for critical components of ICT.

IDRBT INITIATIVES

Working closely with UIDAI,NPCI. Developed Common and Inter-operable standards for smartcards. Accepted by Indian Banking Association (IBA). Common and Inter-operable standards for Micro. ATM in final stages. Working with UIDAI,NPCI,IBA,RBI. Developed inter-operable standards for mobile banking in association with Banks, Telco, Service Providers. Lab tests are in progress at IIT Chennai. Working with NABARD-FITF to technically evaluate proposals for viability GAP funding in ICT-FI initiatives of Banks.

MENU OF SOLUTIONS

Business Correspondent Enabled. Smart Card Based Mobile Banking (Bank Led Model)

SMART CARD BASED SOLUTIONS (OFFLINE)

Customer

Bank Terminal

F. I. Server

Core Banking Solution

MOBILE BANKING
Over 500 million subscriber base. Low transaction cost. Regulatory Framework in place. Bank Led Model to begin with collaborative models are explored.

MOBILE BANKING SOLUTION BANK LED MODEL

UIDAI NPCI Settlement Agency

Bank A

Bank B

BC Micro ATM Customer ( Smart Card / Mobile Phone)

Merchant PoS

OFF US CHART OF UIDAI

AGENCIES INVOLVED IN IMPLEMENTATION

IDRBT Institute for Development and Research in Banking Technology
Role: Technical Standards / Frameworks Development, Inter-operability and security.

NPCI National Payment Corporations of INDIA.

Role: Build and operate switch for InterBank transactions and settlement.

AGENCIES INVOLVED IN IMPLEMENTATIONCONTD

UIDAIUnique Identification Authority of INDIA.

Role: Build and operate bio metric database for the entire population. Helps in authentication and Identity Management.

IBA Indian Banks Association.

Role: Propagate Standards / Frameworks.

AGENCIES INVOLVED IN IMPLEMENTATIONCONTD

I.I.T. Indian Institute of Technologies

--Chennai and
Kanpur Role: Help Develop frameworks and conduct lab tests.

R.B.I Reserve Bank of INDIA.

Role: Regulatory Framework to ensure safety and security.

EMERGING SCENARIO

Branchless Banking Model

RESERVE BANK OF INDIA

RBI PLAYS A CATALYSTIC ROLE AND ORCHESTRATES THE EVOLUTION OF BRANCHLESS BANKING TO ACHIEVE FINANCIAL INCLUSION