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Leveraging Village Banking and Data for Greater Financial Access


People living in rural areas tend to trust banks less as compared to village savings group or informal means of savings. This is because people in rural areas tend to live far from banks and save in small amounts. Furthermore, affordable pricing and low population densities put limits on the banks in order to provide sustainable solutions.

So the question that needs answering is how should rural peoples’ financial needs be met in a way in which these people are comfortable in managing their finances? Secondly, how best to leverage customers’ data in order to predict their transactional tendencies and build on their initial account activity.

Answer to the first question is in linking formal banking with village groups in order to capture high quantity and low value transactions. Furthermore, developing an analytical model for better understanding of what drives rural customers account activity.

While figuring out how best to find a viable solution to these problems it is crucial that the capacity of the target audience is kept in mind, so that they have no problems in utilizing these digital services.

While technology has been helpful in both cases to improve rural outreach and increase touch points with the underserved and unbanked, the customer experience is a journey where institutional learning is still an ongoing process.


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