The Indian government is establishing 75 Digital Banking Units (DBUs) across the nation to further the rate of financial inclusion within India.
Aligning with the 75th anniversary of India’s independence, the scheme seeks to make financial services more accessible to the country’s 1.3 billion people.
The DBUs are essentially brick and mortar outlets equipped with internet services and tablets that citizens can use to complete basic banking activities.
These activities might include opening a current or savings account, transferring funds, paying a bill or tax, or accessing government schemes.
Small businesses will also find these DBUs useful, as they will allow them to make applications for loans, credit cards and insurance.
DBUs will enable customers to have cost-effective, convenient access and enhanced digital experience of banking products and services throughout the year.
They will spread digital financial literacy and special emphasis will be given to customer education on cyber security awareness and safeguards.
Eleven public sector banks, 12 private sector banks and one small finance bank are participating in the endeavour.
The initiative was announced by the Indian Prime Minister Narendra Modi on Sunday via a virtual conference, and continues the promises made during Finance Minister Nirmala Sitharaman‘s 2022-23 Union Budget, which confirmed the distribution of the DBUs.
Speaking at the conference on Sunday, Modi emphasised how the initiative will seek to further financial inclusion and enhance banking experience for Indian citizens.
“DBU is a big step in the direction of ease of living for the common citizens,” he said.
The Prime Minister informed that in such a banking setup, the government aims to provide maximum services with minimum infrastructure, and all of this will happen digitally without involving any paperwork.
It will also simplify the banking procedure while also providing a robust and secure banking system.
“People living in small towns and villages will find benefits like transferring money to availing loans. Digital Banking Units are another big step in that direction which is going on in the country to make the life of common man of India easier”, he added.
The Prime Minister’s speech identified India’s shift from the phone banking climate of pre-2014 to digital banking, which has come to define its financial journey over the last eight years.
As a result of this shift to fintech, Modi confirms that India’s economy has progressed and developed with a continuum.
“The economy of any country is as progressive as its banking system is strong,” he remarked.
In his speech, Modi pointed out that before 2014, the banks used to get phone calls to decide their functioning.
Phone banking politics had made the banks unsafe and made the country’s economy insecure by sowing the seeds of financial crime and scams.
In a transition away from banking that’s entirely dependent on phone-to-phone conversations, Modi hopes that the new DBU initiative will pioneer with its transparency focus.
“After bringing transparency in the identification of NPAs, lakhs of crores of rupees were brought back into the banking system,” he said. “We recapitalised banks, took action against willful defaulters, and reformed the Prevention of Corruption Act.”
With priority awarded to the most financially-excluded, the initiative has gained a positive reputation in providing banking services for all; elements of which will promote India as one of the world’s leading powerhouses in fintech.
Even the World Bank has commended the country in its efforts, something that Modi touched upon in his speech.
“The World Bank has even gone so far as to say that India has become a leader in ensuring social security through digitisation,” he said.
Time will tell if the DBUs are wholly embraced by the audience they seek to serve.
Image and article originally from thefintechtimes.com. Read the original article here.