Making banking correspondents work
While the number of business correspondent agents or customer service points has increased over the last two years, rural coverage is still less than satisfactory. As of March 31, 2012, just 1.47 lakh villages had banking presence, out of the 5.93 lakh villages in India. There have been numerous changes in the BC model as it has evolved since 2006. While some of these changes were positive, some have held back smooth progress. For instance, opening up of the BC space by allowing for-profit corporates was a positive step, allowing BC agents to work for multiple BCs and banks was another one. However, the cluster model ran into difficulties with its design but, thankfully, appears to be on its way out of those difficulties within the year.
The key goals include allowing ultra small branches to be set up with regular attendance of bank officials and BC agents at these kiosks. This has enhanced the BC-bank relationship in the eyes of the customer. Each gram panchayat is to get one BC, now even common service centres are set to operate as BCs, the number of PoS terminals is to increase from 6 lakh to 20 lakh and India Post may also
