Mumbai, March 19, 2019: Business Correspondents Federation of India (BCFI), the national association of Corporate Business Correspondents (CBCs) and Agent Business Correspondents (ABCs), recently met with the RBI-mandated Committee on Deepening of Digital Payments headed by Shri. Nandan Nilekani to discuss ways in which financial inclusion can be achieved better and faster. One of the key recommendations made by BCFI was to allow offering multiple products from multiple banks at same Agent so that there is innovation in offerings and choices available to customers. While the intent of GST to exempt inclusion has been there, the circulars are non-operational due to non-identifiability of a PMJDY account or Rural presence of an account at the time of servicing a customer at BC Agent outlet and this can be simplified and actualised by announcing NIL GST for services at BC Agent outlets. In addition, it also sought the committee’s support on setting up an SRO and reviewing the pricing framework to make the BC channel viable. Instituting a rating system for business correspondents and fintech firms too was brought up.
In its presentation to the Committee on Deepening of Digital Payments, BCFI suggested that business correspondence agent outlets should be allowed to provide products and services from multiple banks so that just like online shopping, a customer has choice to use various payment methods and Payment Gateways, the poor customers should not be left high and dry if one sponsor bank’s server/connectivity is down for some reason or if the sponsor bank is not willing to raise micro deposits or offer low ticket loans. This will ensure better last-mile delivery of innovative financial products being created and encourage partner banks to be more proactive in serving consumers.
Dr.Anand Shrivastav, Chairman BCFI, said “Over the past few years, BCs have been working in line with the national objective of building a robust financial services retail infrastructure across the country, assisting customers with their needs of banking, insurance, pension and credit requirements. Amongst the eight recommendations we have made to the Committee on Deepening of Digital Payments, BCFI has, in the interest of customer protection and regulatory compliance, sought BC guidelines and approval as a Self-Regulatory Organisation for the BC sector.”
“We have also asked the committee to consider allowing business correspondents to be able to provide multi-bank products and services to consumers. This in turn will enable payment and remittance services providers to create more innovative products for the massive non-digital consumer base across the country. Moreover, such a facility will only help consumers access a wide range of services from multiple banking service providers on time in the event of one bank dealing with technical issues or delays in the processes,” said Mr. Anand Kumar Bajaj, Chairman of Communications Committee of BCFI.
During the meet with the committee, representatives from BCFI also sought clarification on the issue regarding BCs being charged GST when making fund transfers to non-Jan DhanYojanaAccounts or Rural accounts. BCFI asked for clarity on this as business correspondents do not have visibility to distinguish between PMJDY and non-PMJDY accounts or place of branch for interbank transactions at the point of remittance. Further, the industry body also requested the RBI to avoid need of monthly deposit statements to each migrant customer, especially for micro deposits in urban centers. This should be digitized and sent through SMS/IVR/local print statements at Agent outlet, else many banks would not like to participate in these programs thus leaving the poor customers to suffer Ponzi schemes.
Representatives from BCFI also sought clarification on being Authorised Representative of Banks for the purpose of conducting KYC to register agents and customers. Additionally, it proposed that agents who have undergone their KYC process should not be required to undergo the same process when offering services from other bank.