- Business Correspondent
- Eligibility to become a Business Correspondent
- Functions of BCs
- RBI act as BCs
- Activities to be undertaken by BC
Business correspondents are said as bank representatives helps villagers to open bank accounts. Business Correspondents get commission from bank for each new account gap, each dealing created via them, each loan-application processed etc. The Business Correspondent carries a mobile device and helps villagers in banking transactions. The inhabitant offers his thumb impression or electronic signature, and gets the cash.
Business Correspondents square measure retail agents engaged by banks for providing banking services at locations apart from a bank branch/ATM. BCs change a bank to produce its restricted vary of banking services at low value. They therefore square measure instrumental in promoting monetary inclusion.
Eligibility to become a Business Correspondent
As per the run batted in pointers, the subsequent entities square measure eligible for appointment of Business Correspondents (BCS) for banks:
- NGOs/MFls originated beneath Societies/Trust Acts
- Societies registered beneath reciprocally assisted Cooperative Societies Acts or the Cooperative Societies Acts of States
- Section 25 firms that square measure standalone entities or within which NBFCs, banks, medium firms and different company entities or their holding firms didn’t have equity holdings in far more than ten per cent
- Post offices
- Retired bank workers,
- Retired government workers.
- Individual kirana / medical / truthful value search house owner’s Individual Public decision workplace (PCO) operators
- Agents of little Savings Schemes of state of India/Insurance firms’ people United Nations agency own gas pumps
- Retired lecturers
- Authorized functionaries of well-run Self facilitate teams (SHGs) connected to banks Non deposit taking NBFCs (non-banking finance firms) within the nature of loan companies whose small finance portfolio isn’t but eighty per cent of their loan outstanding within the financially excluded districts as known by the Committee on monetary Inclusion.
- RBI has currently permissible banks to interact any person, as well as those operative Common Service Centres (CSCs) as BC, subject to banks’ comfort level and their finishing up appropriate due diligence as additionally instituting further safeguards as could also be thought-about acceptable to minimize the agency risks.
BCs got to do a range of functions viz, identification of borrowers, assortment of little worth deposit, disbursal of little worth credit, recovery of principal / assortment of interest, sale of small insurance/ investment company merchandise/ pension products/ different third party products and receipt and delivery of little worth remittances/ different payment instruments, making awareness concerning savings and different merchandise, education and recommendation on managing cash and debt message, etc. merchandise provided by BCs. As per the run batted in pointers the merchandise provided by BCs are: little Savings Accounts, mounted Deposit and continual Deposit with low minimum deposits, remittent to any BC client, small Credit and General Insurance. The BC model permits banks to produce door-step delivery of services particularly ‘cash in money out’ transactions at a location a lot of nearer to the agricultural population, so addressing the last-mile downside.
RBI act as BCs
RBI has provided an extended list of entities and persons United Nations agency will act as BCs. ab initio the entities permissible to act as BCs enclosed registered entities like NGOs/ MFIs. Later, the list distended to incorporate people like retired bank workers, retired lecturers, retired government workers and ex-servicemen, individual house owners of kirana / medical /Fair value retailers, individual Public decision workplace (PCO) operators, agents of little Savings schemes of state of India/Insurance firms, people United Nations agency own gas Pumps, approved functionaries of well-run Self facilitate teams (SHGs) that square measure connected to banks. the other individual as well as those operative Common Service Centres (CSCs) are allowed to act as BCs of banks.
Though the BC model was enticing it’s not delivered effectively owing to the various shortcomings related to it. Firstly, banks have obligatory higher restrictions on operations of BCs. Secondly, salaries of BCs were terribly low compared to the physical work they need to try and do to hide the distant areas. The JDY additionally heavily depends the operations of BCs for continuation of account activities by the village people that started the account as a part of the programme.
Activities to be undertaken by BC
- Creating awareness concerning savings and different merchandise and education and recommendation on managing cash and debt message.
- Identification of potential customers
- Collection and preliminary process of assorted forms for deposits as well as verification of primary data / information
- Filling of applications / account gap forms as well as nomination clause and Submission to the Bank.
- KYC will be completed by the BC.
- Opening of no adornment deposit accounts and different merchandise as permissible from time to time by leverage technology.
- Collection and payment of little worth deposits and withdrawals; Min : nil; Max: Rs. 2000/ per dealing.
- Receipt and delivery of little worth remittances / different payment instruments, as per FL set up of IDBI Bank.
- In respect of all such transactions, the BC/his agent are going to be approved to simply accept / deliver money either at his place of labor or at any convenient location subject to the ceilings per client.
- Furnishing of mini account statements and different account data, for a amount of three months.
- Any different service on behalf of the Bank, punctually approved by the acceptable authority.
- The activities undertaken by the Business Correspondents would be at intervals the traditional course of the Bank’s banking business, however conducted through and by the entities at places apart from the Bank’s premises.
- In respect of all such transactions, the BC/his/her agent are going to be approved to simply accept / deliver money either at his place of labor or at any convenient location subject to the ceilings per day / per client as ordered down.