Policy needed to compulsorily recruit at least 30% of workforce as women BC: SBI report

There is a need to put in place a policy framework to compulsorily recruit at least 30% of the total workforce as female Business Correspondents (BCs), especially in places where access to and use of accounts Pradhan Mantri Jan Dhan Yojana (PMJDY) by women are weak, according to an economic research report by State Bank of India (SBI).

Referring to the findings of the 2017 Global Findex report, which revealed that the majority of female PMJDY accounts remain inoperative, the “Ecowrap” report noted that out of the total 45.2 crore PMJDY accounts opened to date, 55% of holders accounts are women, women officers make up less than 10% of the total BC workforce today.

“The problem is most pronounced in the northern, eastern and central states, which host the bulk of the population explosion while also hosting nearly two-thirds of BC’s total network, but below better representation of female officers,” said Saumya Kanti Ghosh, Group Chief Economic Advisor, SBI.

If more women move into the ecosystem of British Columbia, they can significantly and significantly change the socio-economic fabric of these areas, he said, adding that there is a need to promote the women as torch bearers of correspondent banking (BC).

PMJDY recipients had an outstanding balance of ₹168,138.78 crore in their accounts as of April 13, 2022. BCs are retail agents engaged by banks to provide banking services at locations other than a bank branch/a ATM.

PMJDY aims to ensure universal access to banking facilities with at least one basic bank account for each household, financial literacy, access to credit, insurance and retirement facilities. Additionally, recipients get a RuPay debit card with built-in accident insurance coverage of र1 lakh. The plan also envisages channeling all government benefits to beneficiary accounts and promoting the Centre’s Direct Benefit Transfer (DBT) scheme.

The SBI report noted that “when considering the ability of CBs to positively impact the financial inclusion of approximately 25 crore (and, counting upwards) female PMJDY account holders, the “gender” of the agent, the face linking the myriad of financial world to doubtful, hesitant and weak even on the basic principles of the recipients of skills… becomes a factor of decisive importance to proliferate and deepen financial inclusion campaign.

Better representation in the South

According to Ecowrap, Southern states fare better on the “representation of female officers” metric, reflecting better digital literacy proliferating at the bottom of the pyramid, now harnessed locally.

“Women BC agents bring more transparency to the system, build more relationships with diverse client groups, and promote demand-driven supplemental income while also giving a boost to small savings programs and social security offerings. “, said Ghosh.

SBI’s Economic Research Department (ERD) highlighted that female agents in BC are bringing more transparency to the system, building more relationships with diverse client groups, and promoting additional demand-driven income while giving a boost to small savings schemes and social security offerings.

Best answer for BC women

The ERD suggested that Bank Sakhis hired under the National Rural Livelihoods Mission (NRLM) could be considered for appointment as BCs, as they are familiar with routine banking operations and hold IIBF (Indian Institute of Banking and Finance) mandated.

Also, a central pool can be created containing the details of all these Bank Sakhis. As a facilitator, arrangements should be made on the NRLM/National Urban Livelihoods Mission (NULM) website to upload information from Bank Sakhis which can be accessed by banks and BCs to engage as points CSP customer service department).

The ERD team estimated that reserving at least 30% of CBs for women in the future can have three profound implications for the banking system, in addition to increasing women’s participation in the labor force.

First, all customers find that female agents in BC are more patient and more willing to answer questions or explain product features. In addition, female clients are willing to share their family’s financial needs more openly with female agents in BC.

Second, female officers in BC bring similar or more business and could serve more underserved people. BC’s female agents play a critical role in deepening financial inclusion. They are more likely to serve customers in remote areas, older customers, and other underserved customers.

Third, female agent networks could offer a combination of benefits, such as encouraging savings among women, onboarding more female first-time users, low value but with high frequency and the provision of financial services at home.

Published on

April 26, 2022

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