Impact of Branchless Banking in Indian Rural Areas as a Part of Financial Inclusion

The Indian Government effort to build a more inclusive financial system focuses on lower income people who live in rural areas and who might have limited and infrequent needs for financial services. Private banks do not seek out poor people as customers because poor people typically do not figure into banks“ business strategies to expand and improve their operational and financial performance. Over the last three years, the Reserve Bank of India (RBI) and the Government of India have adopted financial inclusion as a policy objective and have taken actions to move toward the goal of universal access to financial services. They have accepted branchless banking as a feasible proposition for acquiring clients and delivering services. On a global level, branchless banking has adopted both bank-based and nonbank-based models; however, only bank-based models are permitted to operate in India. This paper focuses on branchless banking models that can serve poor and marginalized section of Society.