INSTITUTE FOR DEVELOPMENT AND RESEARCH IN BANKING TECHNOLOGY

RBI-OECD Workshop

Delivering Financial Literacy March22-23, 2010. Bangalore

Presentation by:

Mr. B. Samba Murthy

Director, IDRBT.

Website: www.idrbt.ac.in

Email: bsambamurthy@idrbt.ac.in

“Established by RBI in 1996 for

promoting use of technology in

Banking Sector.”

MISSION

Explore and Exploit technology for common

good

FINANCIAL EXCLUSION – A FEW DIMENSIONS

Over 100 Million house holders had no

formal access to credit.

Nearly 600 million new accounts to be

opened.

Out of 6,25,000 villages there are bank

branches only in about 30,000 villages.

REAL CHALLENGE

Provide basic financial services to over

300 million excluded people spread over

600,000 villages.

Use of I.T. is inevitable to provide access to

formal Banking services.

BUSINESS NEEDS

Increase outreach

Scale up number of users

Reduce Opportunity cost/time

Ensure Reliability

Integrity of Account and Information

Ensure Security

High Degree of Assurance

Inter-operability

ROLE OF IDRBT IN FINANCIAL INCLUSION

Encourage Banks to develop an

appropriate ICT platform.

Facilitate development of common and

inter-operable standards for critical

components of ICT.

IDRBT INITIATIVES

Working closely with UIDAI,NPCI.

Developed Common and Inter-operable standards for smartcards. Accepted by Indian Banking Association (IBA).

Common and Inter-operable standards for Micro. ATM in final stages. Working with UIDAI,NPCI,IBA,RBI.

Developed inter-operable standards for mobile banking in association with Banks, Telco, Service Providers. Lab tests are in progress at IIT Chennai.

Working with NABARD-FITF to technically evaluate proposals for viability GAP funding in ICT-FI initiatives of Banks.

MENU OF SOLUTIONS

Business Correspondent Enabled.

Smart Card Based

Mobile Banking – (Bank Led Model)

SMART CARD BASED SOLUTIONS

(OFFLINE)

Customer Bank

Terminal F. I. Server

Core Banking

Solution

MOBILE BANKING

Over 500 million subscriber base.

Low transaction cost.

Regulatory Framework in place.

Bank Led Model to begin with

collaborative models are explored.

BC Micro ATM Merchant PoS

Bank A Bank B

UIDAI Settlement

Agency

Customer

( Smart Card / Mobile Phone)

NPCI

MOBILE BANKING SOLUTION BANK LED MODEL

OFF US CHART OF UIDAI

AGENCIES INVOLVED IN IMPLEMENTATION

IDRBT – Institute for Development

and Research in Banking Technology

Role: Technical Standards / Frameworks

Development, Inter-operability and security.

NPCI – National Payment

Corporations of INDIA.

Role: Build and operate switch for Inter-

Bank transactions and settlement.

AGENCIES INVOLVED IN IMPLEMENTATION…CONTD

UIDAI—Unique Identification Authority

of INDIA.

Role: Build and operate bio metric database

for the entire population. Helps in

authentication and Identity Management.

IBA– Indian Banks Association.

Role: Propagate Standards / Frameworks.

I.I.T. – Indian Institute of Technologies

--Chennai and

Kanpur

Role: Help Develop frameworks and conduct

lab tests.

R.B.I – Reserve Bank of INDIA.

Role: Regulatory Framework to ensure

safety and security.

AGENCIES INVOLVED IN IMPLEMENTATION…CONTD

EMERGING SCENARIO

Branchless Banking Model

RESERVE BANK OF INDIA

RBI PLAYS A CATALYSTIC ROLE AND

ORCHESTRATES THE EVOLUTION OF

BRANCHLESS BANKING TO ACHIEVE

FINANCIAL INCLUSION