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Govt gives go-ahead for mobile banking

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CIOL Bureau
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NEW DELHI, INDIA: Going a step further in financial inclusiveness that envisions the empowerment of the poor, a committee of secretaries headed by the cabinet secretary has approved the recommendations by an Inter Ministerial Group (IMG) constituted by the Government on DIT’s initiative.

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The IMG was chaired by the Secretary, DIT and included, among others, representatives from Department of Financial Services, Department of Posts, Ministry of Rural Development, Planning Commission, UID Authority of India, TRAI, RBI, Department of Telecom and the Home Ministry.

The recommendations were made after extensive discussions among members and other stakeholders involving the banks, telecom providers, security agencies, and the public, and holding three meetings of the full Group and several meetings of the sub-group constituted by it.

Government said banks have been advised to start mobile banking services in rural areas by July 31, and complete the roll out by December 2011.

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Government expects that the provision of basic financial services through the individual’s mobile could be a major step in the direction of reaching out to the unbanked sections of the country.

“With the acceptance of the report of inter-ministerial group by the committee of secretaries banks are being advised to implement the IMG framework on priority basis to extend basic financial services to the unbanked population,” said an official communique released on Friday.

“The report of the IMG assumes significance considering the growing number of mobile subscribers among the rural population and the disadvantaged sections. With mobile subscribers in rural areas far outstripping bank account holders, a large section of rural population now has access to mobile telephony but not to financial services,” it added.

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The IMG framework based on mobile phones and biometric-based authentication will form the core micro-payment platform for transfer of benefits under various Government schemes, micro-payment services and financial inclusion for the target groups of social sector programmes, said the press release.

Besides delivery of basic financial services to the poor and disadvantaged, both urban and rural, the mobile-based delivery model will cut delay and reduce the costs and hardships incurred by the beneficiaries in availing the cash benefits under various welfare and poverty alleviation schemes.

©CyberMedia News

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