A move that will lead to financial inclusion in rural areas, Common Service Centres (CSCs) have partnered with leading private sector bank HDFC to work as banking correspondents.
CSCs, which work under the public private partnership (PPP) model, are one of the mission mode projects under the Digital India programme. As part of the agreement, village level entrepreneurs (VLEs) managing the CSCs will operate as banking correspondents of HDFC Bank. There are around 300,000 CSCs across the country. The move will allow CSCs to offer all the banking facilities of HDFC bank to rural population like deposits, withdrawal and also loan facilities.
HDFC Bank CEO Aditya Puri said that all the facilities which are available in cities will be made available to people in rural areas through CSCs. “The partnership makes good business sense for us as 60 per cent of Indians live in rural and semi urban areas,” Puri said while signing the agreement with CSCs. He said the systems of HDFC would be integrated with CSCs so that they can offer all the services.
This agreement is expected to be a game changer as it would significantly contribute to government’s objectives of enabling direct benefit transfer (DBT) of various schemes. The government said women, senior citizens and persons with disability would especially get benefitted through this initiative. This would facilitate withdrawal and deposit of government entitlements such as payments under MGNREGA as well as various social welfare schemes like widow pension, handicapped and old age pension, etc.
The HDFC banking correspondent (CSC) under this arrangement would also function as a business facilitator (BF). This is a unique facility being extended through CSC by HDFC. “This will help and support the citizens, especially merchants, youth, entrepreneurs, farmers and women avail loan facility from the bank to support in their economic uplift,” the government added.
Apart from this, HDFC Bank will support CSCs in converting 1,000 identified villages into Digi Gaon (Digital Villages) within this financial year. As part of the Digi Gaon initiative, CSCs were providing various online services of the central and state government.