Open an account at a PCO shop — myth or realty ?

Well, so in my earlier post I wrote that telecom operators might be issues a banking license and we might see Telecom operators in the banking sector. However the RBI has different thought process. RBI feels if the mobile operators are start carrying out csh transactions then there will be a alternate channel for the money to flow. As the mobile operators are well known for not following KYC norms, there is a he possibility that it might lead to unfair means of money transfers at the same time there is a possibility of customer’s data being misused.
On the contrary, RBI is planning to appoint Kirana stores, PCO operators, retired teachers as banking agents. These agents will be selected on certain criteria such as past experience on cash flow handling, past record etc. Now how these agents are going to carry out these transactions? Obviously with the help of technology. One model which is already existent with the help of companies such as FINO or a little world. These companies provide technology platform to banks and helps them cater to the rural areas where formal banking channels are not available. A smart card is issued to the rural consumer & a no frill account is opened with the bank. Whenever the person need to deposit/withdraw cash the consumer can go to the designated bank agent and place his smart card on the machine available with the vendor. Once the card is placed on the machine he can see his account details. The money is given to the agent and it reaches the bank through collection agents.
So everybody has access to the bank. Going forward the same services can be availed with the help of mobile phones provided the issues such as encryption of sms and other security issues are addressed. In India many people like to check their account balance from phone.
One thing which has remained common in the world is that technology can not drive the market however the market drives the technology. In many countries internet banking was a boom, however in India compared to internet banking, mobile banking is finding more application and uses.
So hoe this model works will totally depend upon the acceptance at the grass root level. With the poor broadband penetration, one thing is sure the connectivity will be wireless.
Regards
Mahesh

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