NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Friday, February 14, 2014

A decade ago, financial inclusion was merely a regulatory compulsion for most private banks in the country. But now many of them have stepped up efforts to improve the penetration of banking services, notwithstanding their disagreement over Nachiket Mor committee’s recommendations on financial inclusion.

While private banks are expanding their reach in deeper geographies, they are not solely relying on brick-and-mortar branches to serve the rural population.

India’s largest private lender ICICI Bank is now using light commercial vehicles to serve many of its rural customers in Maharashtra. The vehicles – equipped with mini ATM, safe, laptops (connected to the bank’s core banking platform), and machines to count notes and detect forged cheques – cover three to four unbanked villages a day. The model, Branch on Wheels, allow the bank to serve a sizeable population in remote locations in a cost effective manner.