Financial inclusion is a critical driver of economic growth and prosperity because it guarantees that financial services are available and accessible to all parts of society. In recent years, digital payment channels have played an essential role in increasing global financial inclusion.
The Challenge of Financial Inclusion
Many developing countries have struggled to provide financial services to all of their residents. Due to a lack of access to traditional banking infrastructure, a sizable segment of the population, particularly in rural regions, remains unbanked. These individuals and small enterprises are barred from participating in the official safe online banking system, limiting their economic advancement.
With the total digitization of financial banking services, people can create a digital bank account with any rural banking channel mandated by the RBI, no matter where they are. A specially constructed ‘Basic Savings Bank Deposit Account’ (BSBDA) guarantees that individuals have free access to a variety of financial services.
Hassle-Free Bank Accounts
Since mobile phones are so widely used, a safe online banking can be created in minutes with digital KYC and rapid money transfers via UPI are possible. Banks may save money on infrastructure and operations and pass the savings on to customers through value-added services and account features.
Mobile Money as a Solution
Mobile money is a digital mobile banking service that allows people to save, transmit, and receive money using their phones. It makes use of considerable mobile phone penetration in rural areas to make financial services available even in the most remote areas. Individuals may use their phones to create mobile money accounts, deposit and withdraw money, pay bills, and obtain credit.
Digital Wallets: Redefining Financial Transactions
Digital wallets have garnered widespread acclaim globally, offering a secure and convenient avenue for executing financial transactions. These electronic wallets permit users to digitally store money, facilitate payments, and transfer funds effortlessly. They surpass geographical constraints, allowing even the most isolated communities to partake in the digital economy. Featuring user-friendly interfaces and smooth integration with mobile internet banking, digital wallets empower individuals to participate in cashless transactions, diminishing the dependence on tangible currency and augmenting financial security.
Impetus to the Rural Economy
As an increasing portion of the population becomes accustomed to mobile money, the trend of digital transactions infiltrates various facets of life, encompassing business and commerce. The presence of money on mobile platforms enables rural businesses to expand their reach to a broader audience swiftly, enhance cash flow, and analyze financial data more effectively, as it is readily available and compiled.
Better Access to Economic Facilities
Through a digital bank account, individuals can eliminate concerns about timely wage deposits or the receipt of pension and insurance benefits. The mobile app seamlessly integrates a range of mobile banking service, simplifying the process for citizens to apply for various government schemes and loan products.
Beyond mobile money transfers, citizens can avail themselves of a variety of value-added services. These include the ability to settle utility bills, engage in online shopping, fulfil tax payments, and even make investments directly from their handheld devices.
Rural India serves as, and will persist in being, the foundation of our economy. The use of mobile money enables us to foster inclusive and sustainable growth, creating enhanced economic opportunities. This has the potential to redirect income distribution and consumer spending patterns, contributing to an escalation in overall growth.
Mobile money transcends being merely a transaction tool; instead, it stands as a potent instrument for bringing about positive change. Aligned with this perspective, IDFC FIRST Bank has introduced its innovative and user-friendly mobile banking app. Facilitating an uncomplicated account opening process, this best online bank offers a comprehensive range of financial services, including money transfers, UPI and QR-enabled transactions, bill payments, loan requests, and even opportunities for mutual fund and insurance investments.