When Technology Meets the World of Financial Inclusion
The focus on achieving “IDENTITY-VERIFIED CLEINT ACQUISITION FOLLWED BY A REAL-TIME CHECK ON CREDIT WORTHINESS AND INSTANT CASHLESS LOAN DISBURSAL” has been increasingly growing in general across the ASEAN region and some of our South-Asian counter parts where the socio-technological ecosystem is very different from INDIA.
So what exactly is the INDIA ecosystem that makes it so different and enviably attractive to emulate for its neighbours in the region?
First, The INDIA scenario of AADHAR authentication and integration with CREDIT BUEREAUS and PAYMENT BANKS has made the last mile agility a realized goal for many organizations in the gamut of small finance banking, micro-credit and MSME lending including Bharat Financial Inclusion Ltd, one of the first publicly listed companies.
While there are efforts which need governments’ and regulatory intervention in the ASEAN region (such as a National ID mandate), biometrics as a technology can indeed make a big difference in tapping the full potential of a potential 150 million unbanked households and small entrepreneurs if it solves three basic challenges of ensuring that -
1. The customer receiving the credit and making a loan payment is indeed the one he/she claim to be and he/she is always the same physical person at any subsequent transaction
2. Any contact/transaction with a customer gets validated for sanctity
3. Employees with access to sensitive/confidential KYC information, payment procedures, etc. are indeed the ones corresponding to the password tokens used
The last decade has exposed many solution pieces (such as finger print scanners, retina scanners, biometric card based systems) which somehow couldn’t quite complete the customer experience puzzle that the AADHAR UID project in India solved meticulously. This was made possible by a combination of technology and the thrust from the Indian government.
The biometric technologies and the IT infrastructure underneath worked well in rural disconnected environments, however only when equally complemented by an extensive canvas of professional leadership, strong backing from the government and the regulatory bodies.
It is therefore high time that state-of-art technologies emerge to not only tap the ASEAN financial markets(particularly the likes of Indonesia, Philippines, Sri Lanka, Vietnam) but also to fit better the macro needs of the governments and the large financially excluded population of these fast emerging economies.
Mobile and card-based ID solutions (such as the RFID and NFC) when cross leveraged with GPS and map based tools can be effective tools to validate the personal identities in outdoor/non-connected areas hence making them an interesting space to watch out for small banks, MFIs and anyone operating in the ASEAN financial inclusion domain.