Fintech in India: Revolutionising Access to Finance

Abstract

Technology-enabled financial inclusion in India has been on top of the development agenda of the present government. The attempt to bring in the marginalized sections of the society within the ambit of the banking system is laudable. Smart phones have penetrated the nook and corner of India. Yet the rural population is still not too confident about using Internet banking or automated teller machines for withdrawing cash. The infrastructure development for internet connections in rural areas still needs improvement.
The efficiency of existing Automated Teller Machines (ATMs) can be improved by improving the process of money transfers in the ATMs. Linking the Aadhaar number to bank accounts can simplify the process. Our aim is to provide another avenue for money transfers, without having the need for personal internet connection. Thus, those without access to internet can access the ATM for transferring or withdrawing money. This will result in more people reaping the benefits of a formalized financial sector in India eventually leading to a win-win situation. Those, without Aadhaar cards, can enroll for them and this will end up fulfilling the Government initiative of providing Aadhaar cards to all Indian residents. Secondly, those with non-operational bank accounts, especially the Jan-Dhan accounts would have an additional incentive to begin using them.
Additionally, FinTech companies can use the opportunity to expand their business in India’s rural areas. Technology enabled innovations in FinTech can be used to support micro finance and micro insurance.