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December 01, 2007

Taking banking to migrant laborers

Businessworld has an article on an interesting experiment by Axis Bank along with an NGO.
Anwar is one of the nearly 1,500 urban labourers who have joined a technology-assisted financial inclusion programme started by Basix, which describes itself as a livelihood promotion institution. The project, in collaboration with Axis Bank, provides basic, no-frills banking services to poor migrant workers. Basix and Axis Bank have also started a pilot remittance project to help migrant labourers in East Delhi transfer money quickly to dependents in Muzaffarpur in Bihar.

...Basix and Axis Bank are conducting their experiment in financial inclusion in the eastern part of Delhi, home to the capital’s largest slum. The area is populated largely with immigrant workers from remote hamlets in Bihar and Uttar Pradesh. “Most of the people who have enrolled for the pilot project are those who make a living as rag pickers, rickshaw pullers, house maids and auto rickshaw drivers,” says Preeti Sahai, who spearheads Basix’s programmes in Delhi. “These people earn very little and, until now, did not have a way to save.”

...Basix field staff physically verify addresses and job details of prospective customers. The staff then fill out the account opening forms for the bank. Basix agents keep making rounds of their respective localities so that customers can meet them to transact business. There is also a local branch office. The field agents carry three devices — a mobile phone and a mini receipt printer. These devices have smart-card sensors and a smart-card scanner with a biometric fingerprint reader to authenticate the ownership of a card as the person who wishes to make the transaction.

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of information and networking services to the private equity and venture capital ecosystem in India. View free samples of Venture Intelligence newsletters and reports.