Banking facilities for the rural people and its benefits

Oct 31, 2012   //   by admin   //   Knowledge Base  //  No Comments


Banking facilities for the rural people and its benefits.

The Reserve Bank of India and the Ministry of Finance giving   micro-credit to the rural sector The Indian banking sector is coming across   complexity for ensuring   profitability and to offer adequate income to the Shareholders As per figures There are  around  135 million rural households  in India with a per capita income of INR 8,000.


Statistics clearly mentions   that rural households have no savings. As per World Bank study  access to financial institutions found that surrounded by rural households in Andhra Pradesh and Uttar Pradesh approx 59 percent lack access to deposit account and 78 percent lack access to credit. In a view of this majority of the 360 million  poor  households  (urban and rural) deficient in accessing to proper financial services. There have been numerous challenges to be  faced  in bringing solutions for banking in rural India both  for banks  as well as for rural population . Thus rural credit delivery    become one of the most important concerns in banking system today. There are lots of initiatives put in to frame but does not work out at desired level of achievement.


The loan examination process particularly the credit rating of potential customers is a big restriction to planned micro finance. There is an imperative require to modernize the credit rating process to arrive to the rural poor. A viable credit rating system will help to reduce the non -performing assets (NPA) of banks .  it will also   help to make sure best use of funds.


In rural areas people are uncertain   towards traditional deposit money and how to suffice from the banking  system  . Looking in to the needs the rural credit delivery system (RCDS)   is set up which give a single depository for all consumer correlated information that banks and financial organization necessitate to turn up at the credit value of the customer. The application for rural credit ranking was formed by TCS. created a Web support request that is made accessible through https protocol.  The objective behind this type of banking system is to bring empowerment with convenient   , instance and critical services comprising   finance , documentation , markets etc. for the rural population  at their doorstep.


Rural Credit Delivery Solution mechanism


Security: From technical point of view, since here money is involved  , this is the key point to create security to the accounts. The checks and bills are made to avoid misuse in any possible way   .   For each login one transaction can be made & then for another it has to be login again. The passward has to be entered during login & then accessibility is allowed. The common users will be able to make one transaction for each logon. The process is simple to use.


Benefits of using central banking system


System to be generated in user friendly manner such as icons should show the regional language so that villagers can understand the text . Illiterates can be use it with the help of voice recording/ voice synthesizer.


Flow of   Information

It will help in providing   information to investors. Due to lack of information financial institutions are unable to reach the rural population. It  is  important to know the credit worthiness of the investor in order to maintain   the business. Thus a central credit system which will help the banks to make appropriate proposals  and   fund    allocation for the rural sector.  It will also help in improving lives and the agriculture economy of the rural area.


Decrease costs

A central information or main server maintained  will help to reduce the cost at certain levels such as   supplementary licensing costs for record and  coverage services and other related components will be cut short , so that the interest for continuing the business for rural areas will be predominant.


Provide High Security

The application is designed to bring communication between computers and connected it with internet in order to maintain high security. On every transaction, audit is maintained and ensures the solution . It also store the workflow to ensure authenticity of the data. This is done by hypertext transfer protocol.


Assist by supporting local Language


As rural population has limited knowledge and literacy among uneducated people . The applications and services has to be simple and easy to use. It should be directly connected to the villagers. Thus the middlemen’s will be avoided in the system.



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