Nabard on Thursday announced that it will extend support to banks for deployment of two PoS devices per village in one lakh villages of Tier 5 and 6 areas having a population of up to 10,000.
Nabard on Thursday announced that it will extend support to banks for deployment of two PoS devices per village in one lakh villages of Tier 5 and 6 areas having a population of up to 10,000. The estimated support will be around R120 crore.
According to senior officials of the bank, the objective is to encourage cashless transactions in remote areas and reach out of to new places that have been out of the ambit of such transactions. Nabard will provide support to banks to acquire some 2 lakh PoS devices which are expected to cover some 1 lakh villages. If this initiative succeeds, there should be no problem in extending the programme further, Subrata Gupta, CGM, department of financial inclusion and banking technology, Nabard, said.
The sanctioning process is expected to be completed by March 31, 2017, and the banks are expected to finish acquisition of PoS machines by December 31, 2017, he added. Nabard will bear 60% of the cost of the machines while the banks will put in the rest. A PoS device usually costs around R8,000 to R12,000 in the market.
Further, to encourage adoption of new generation secure technology among farmers who are already on RuPay KCC platform, Nabard will now support procurement of EMV chip and PIN-based RuPay Kisan Cards by both regional rural banks and the rural cooperative banks. The approximate expenditure for Nabard under this will be R108 crore covering around 4.32 crore KCC holders.
According to Harsh Kumar Bhanwala, demonetisation has posed a huge challenge to the cash-based transactions of rural economy and there is a pressing need to move towards digital transactions. Nabard has played a pivotal role in adoption of banking technology among regional rural banks and rural cooperative banks. Over the last few years, it has brought nearly the entire cooperative banking system onto the Core Banking Solution (CBS) platform. It had also provided financial support to select regional rural banks for moving over to the CBS platform, the first pre-requisite for moving towards cashless banking services.