Accounts opened under Pradhan Mantri Jan Dhan Yojana (PMJDY) as on 17th August, 2016.
No of Accounts With Zero Balance
No of Rupay Debit Card
Public Banks Private Banks
Source: PMJDY report 17th August, 2016
In order to expedite the penetration of financial services in the unbanked regions of India, RBI has created a framework for licensing payment banks/small banks and differentiated banks. These local area banks, payment banks and small banks are expected to meet credit and remittance requirement of the small businesses, unorganized sector, low income households, farmers and migrant workforce. During FY16, in all, 23 new banking licenses were granted which included two universal banks, 11 payment banks and 10 small finance banks. The two universal banks have started their operation during 2015; amongst the small finance banks, Capital Local Area Bank has commenced its operations in April 2016 and others are likely to start their business by Sep 2016. Role of Technology – Digital Banking The last few years have witnessed a transition of banking from a predominantly traditional business to more of a customer focused one. An efficient payment system can be envisaged as the lubricant which speeds up liquidity flow in the economy, thereby creating necessary impetus for economic growth. Customer involvement through the most relevant channels has become of key importance for maximizing customer value and creating newer and more innovative revenue streams for banks. Although some concerns regarding the health of the Indian banking sector prevail, there is a widespread of optimism in the Indian economy. Taking advantage of digital technology and leveraging its potential to transform the banking sector is catching the attention of banking sector leaders. There are enormous opportunities present in the form of internet banking, mobile banking, mobile wallets, cloud computing, information security, and virtualization amongst others, in order to make financial infrastructure smarter, safer and faster. With the new government’s vision for digital India, regulatory moves have positioned Indian banking for digital transformation.
Prepaid Payment Instruments (m-Wallets, PPI cards, Paper Vouchers)
Retail Electronic Clearing (ECS,NEFT,IMPS)
Cards (debit, Credit)
2015-16 2014-15 2013-14 2012-13 2011-12
98.4 92.8 81.1 68.5 55.1
3,141.5 1,687.4 1,108.3
10,038.7 8,424.0 7,219.1 6,174.5 5,731.6
748.0 314.5 133.6
94.7 53.3 25.6
Source: RBI data and Dun & Bradstreet Research
Advent of FinTech Ecosystem The Indian banking industry has embarked upon its digital journey and is catching up quickly with its global peers in terms of technology adoption. In recent years, the phrase ‘FinTech’ has gained a lot of buzz in the Indian financial services sector, media, start-ups and entrepreneurial circles. FinTech are technology based companies that enable and/or collaborate with financial institutions to create highly integrated ecosystems that infuse expertise, rich experience, advanced technology to make existing financial systems more efficient and effective. The advent of the FinTech ecosystem in the Indian banking sector has begun to transform the lives of millions; therefore integrating FinTech in the Indian banking architecture has become a top priority for the banks.
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