A technology solution firm, Financial Information Network and Operations Ltd (FINO) is soon going to launch micro deposit machines in the Indian market. The company aims to take banking to the doors of poor by launching this machine.
Manish Khera, CEO of FINO said, "Poor people find it difficult to go to banks and make a deposit."
"These machines solve that problem, as they will be available at locations where they live," added Khera.
Earlier the firm had also launched biometric smart cards which act as a digital passbook for transactions. These micro deposit machines will look like automated teller machines (ATMs) but are much smaller in size. "They can be placed in ordinary kirana (grocery) shops and require no special construction that ATMs require," Khera said.
The CEO said, "Using their smart cards and these machines people can make deposits at any time and get a receipt at the point of transaction without any paperwork."
Largest private lender, ICICI Bank and the World Bank's private lending arm International Finance Corp (IFC) will help the firm in promoting this device. The company is also working with various banks, micro-finance institutions, insurance firms and the government to provide banking services to the poor in both urban and rural areas.
The firm plans to provide a personalized biometric smart card to each customer as a part of the solutions for development of banking services. "We already have 1.6 million customers using our smart cards solution and that figure should go up to 4 million by the end of March 2009," Khera said. "Our target is to reach 25 million in five years."
The company's smart card has helped more than 1,500 vendors and hawkers to open accounts with Union Bank at Chandni Chowk in Old Delhi. "Union Bank is now using FINO's business correspondents and their technology to enroll vegetable vendors, migrant workers and daily wage earners to open savings accounts."
The areas covered for the purpose are Mumbai, Tamil Nadu, Uttar Pradesh, Chandigarh and New Delhi. In Andhra Pradesh smart cards are used for government pensions and for distributing wages in five districts under the National Rural Employment Guarantee Programme (NREGP).
State owned Punjab National Bank (PNB) has also launched a similar scheme with FINO in New Delhi for migrant workers and daily wage earners.
There are about 300 to 500 million people in the country who do not have access to banks or any financial service. Khera said, "The risks for banks have gone up as they are now using non-employees as agents to extend reach. This is where technology solutions are needed to ensure safety and security of transactions, for both banks and their customers."
FINO was started in 2006 with a capital of Rs 800 million (USD 20 million). It has also decided to support the sponsorship of an event named Indian Microinsurance: What Works? Organized by Microfinance Insights, IFMR Foundation and the Centre for Insurance and Risk Management (CIRM).