Business Correspondent


Ajit Kumar AJIT KUMARWISDOM IAS, New Delhi.

Business correspondents are bank representatives.They help villagers to open bank accounts. They help villagers in banking transactions. (deposit money, take money out of savings account, loans etc.). The Business Correspondent carries a mobile device. The villager gives his thumb impression or electronic signature, and get the money. Business Correspondents get commission from bank for every new account opened, every transection made via them, every loan-application processed etc.

Functions

1.    Create awareness about savings.
2.    Give advice to villagers, about how to save/invest money and how to arrange/manage loans.
3.    Help the villagers to open bank accounts.
4.    Collect loan applications, forward them to bank.
5.    Preliminary processing of loan applications for example: verification of person’s identity, home-address etc.
6.    Help the Self Help Groups (SHG), to get loans.
7.    Help the bank to collect EMIs and recover loan money.

Eligibility to become a Business Correspondent 

As per the RBI guidelines, the following entities are eligible for appointment of Business Correspondents (BCs) for banks:
- NGOs/ MFIs set up under Societies/ Trust Acts,
- societies registered under Mutually Aided Cooperative Societies Acts or the Cooperative Societies Acts of States,
- Section 25 companies that are stand alone entities or in which NBFCs, banks, telecom companies and other corporate entities or their holding companies did not have equity holdings in excess of 10 per cent,
- post offices ,
- retired bank employees, q ex-servicemen , q retired government employees. q Individual kirana/medical/fair price shop owners
- Individual Public Call Office (PCO) operators
- Agents of Small Savings Schemes of Government of India/Insurance Companies Individuals who own petrol pumps q Retired teachers
 Authorised functionaries of well run Self Help Groups (SHGs) linked to banks Non deposit taking NBFCs (non-banking finance companies) in the nature of loan companies whose micro finance portfolio is not less than 80 per cent of their loan outstanding in the financially excluded districts as identified by the Committee on Financial Inclusion
- RBI has now permitted banks to engage any individual, including those operating Common Service Centres (CSCs) as BC, subject to banks’ comfort level and their carrying out suitable due diligence as also instituting additional safeguards as may be considered appropriate to minimise the agency risks


Friday, 11th Mar 2016, 10:58:43 AM

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