Business Correspondents Model in Bihar: Constraints and Way Forward

This paper aims to improve the current body of knowledge around the banking correspondent (BC) model in Bihar, India. It provides recommendations to improve the effectiveness of the model and to offer inputs to policy makers. The paper also carries out institutional assessments for four banking correspondent network managers (BCNM): Society for the Advancement of Village Economy (SAVE), Sanjivani Vikas Foundation (SVK), FINO Paytech Limited, and Centre for Development Oriented Training (CDOT). These BCNMs were identified by a ranking exercise which considered aspects including active customer base of BCs, business viability, service offerings, and active customer service points (CSPs) and their attrition rates. The paper covers the following sections in detail:

• Research methodology used for the study;
• Financial inclusion activity in Bihar with a focus on the status of banking and the BC model;
• Individual assessment reports for each BCNM;
• Case studies for a few successful CSPs of each BCNM;
• Key financial inclusion objectives that need to find a priority among relevant stakeholders;
• Policy recommendations both at a policy and operational level.