Business Correspondent Model as a new Financial Inclusion practice in India

Name: IJSR - International Journal of Scientific Research
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Prof. J.K.Tandon; Jayendra Chaturvedi; Jyoti Chaturvedi

Volume : IV, Issue : VII, July - 2015

Business Correspondent Model as a new Financial Inclusion practice in India

Prof. J. K. Tandon, Jayendra Chaturvedi, Jyoti Chaturvedi

Abstract :

Financial inclusion i.e., access to adequate and timely credit, and other financial services is of utmost importance for socio–economic development of poor and unbanked sections. It enables them to alleviate their poverty levels through self–employment generation and promotes them as a part of rural banking system. Accordingly, Indian Government is being initiated various financial measures in the banking sector, and different microfinance models have been playing an active role in providing microfinance and other financial services to the rural poor. However, despite these efforts, a large number of social groups remained excluded from the basic opportunities and services provided by the formal financial sector. In these circumstances, as a part of financial inclusion drive, Indian government with the help of Reserve Bank of India (RBI) has come up with a new model in the realm of banking sector, called as �Business Correspondent (BC) model�. This model primarily aims at providing affordable banking facility to the hitherto unbanked population with the help of Information and Communication Technology (ICT) based application and capacity building. Against this backdrop, this paper attempts to introduce the concept of financial inclusion and highlights its need.