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Benefits of using BCS
Some of the advantages of using BCs as listed below:
A better alternative for bank branches: Generally, a
rural bank branch can serve
5,000 to 10,000 families in 15 to 20 villages within a radius of 15kms. A Public
Sector Bank branch may require more than 5 years to serve unbanked areas in
India, while a private sector & foreign bank with IT connectivity may require about
5 times more time. Further,
obtaining permission to open a branch is a
long and protracted process. The
BC option potentially enables banks
to reach out much faster and at a much lower cost.
Reaching the unreached: The model enables banks to extend financial services to the unreached clients beyond their branch network as beneficiaries of the BCs are
mostly located in unbanked and underbanked areas.
Better loan performance: Since local stakeholders like NGOs,
post
offices, etc., are involved in the process, they know the customers
at a
personal level. The personal connection enhances the customers'
accountability to the BC, which in turn improves loan performance and repayment rates.
Doorstep banking: Disbursement and loan recovery at the doorsteps of the beneficiary.
Quick expansion: Scaling up of this model is possible within a
short span of time.
Who is Eligible for BC?
1. NGOs/ MFIs set up
under Indian Societies/ Trust Acts. (Care: excluding NBFC)
2. Societies registered
under mutually aided co-op. societies (MACs) Act or the
Coop. Acts of States.
3. Section 25
companies.
4. Post Offices.
5. Retired Bank
employees
6. Ex-Servicemen.
7. Retired Govt.
Employees.
8. Individual Kirana/
medical/fair price shop owners.
9. Individual Public
Call Office (PCO) operators.
10. Agents of small
savings schemes of the Government of India/ Insurance Companies.
11. Individual who own
petrol pumps.
12. Retired teachers.
13. Authorized
functionaries of well-run Self Help Groups (SHGs) linked to banks.
14. Individual member of
Farmer's Clubs.
15. Individual operators
of Rural Multipurpose kiosks/ Village Knowledge Centres
16. Individuals/
proprietors/ owners who manage Agri Clinics/ Agri Business Centres.
17. Retired Post
Masters.
18. Individuals such as
auto dealers, tractor dealers and FMCG stockiest.
19. Insurance agents
including of private insurance companies (IRDA certified) and
postal agents.
20. Individuals
operating Common Services Centres (CSCs) established by
Service Centre Agencies (SCAs) under the National e-Governance Plan (NeGP).
21. For-profit companies
22. Any other individual
considered suitable by the selection committee.
Who is Eligible for Business Facilitator
(BFs)
Under the "Business Facilitator" model, banks may
use the services of intermediaries
such as:
1. NGOs/SHGs
2. Farmers Clubs
3. Cooperatives
4. Community-based
organizations
5. IT-enabled rural
outlets of corporate entities
6. Post Offices
7. Insurance agents
8. Well functioning
Panchayats
9. Village Knowledge
Centres
10. Agri Clinics
11. Agri Business
Centers
12. Krishi Vigyan
Kendras
13. KVIC/KVIB units
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