Guj likely to have common BCA for financial inclusion

Even as the public sector banks continue striving to achieve financial inclusion targets, Gujarat will soon have common business correspondent agents (BCAs) for the entire state, informed sources in the banking circles.

A concept of common business correspondent has been floated to achieve targeted financial inclusion goals.

“Every bank either appoints an outside agency or they go on their own for business correspondent programme. But for better penetration in the remote areas and achieve set targets, a common business correspondent for the entire state is being considered,” said Suresh Patel, convener, Gujarat State Level Bankers’ Committee (SLBC).

In Gujarat, Dena Bank, being the lead bank for the state, will appoint an agency for common business correspondent.

As on March 2012, various PSU banks in Gujarat have appointed 2712 business correspondents in the state. A business correspondent is considered as the main instrument of delivery of financial services in the areas where bank branches are not opened.

A Mumbai-based agency, Financial Inclusion Network & Operations Limited (FINO) is already operational in Gujarat in association with Union Bank of India (UBI).

“We cater to the remote places of Gujarat for financial inclusion programme. We have already covered districts like Jamnagar, Junagadh, Porbandar, Amreli, Surendranagar and Bhavnagar through our BCs. And we look for some more districts to add,” said a FINO official.

FINO, a multi-bank promoted company, has 61,000 borrowers in Gujarat. Also, some banks have appointed. A group of banks including ICICI Bank, HSBC, Corporation Bank, Union Bank of India and Indian Bank are among the promoters of the company.

So far, Bihar, West Bengal, Andhra Pradesh, have already appointed agencies like FINO and Srei for the purpose of common BCAs in their respective states.

In all, a total of 10 states including Maharashtra, Jharkhand, Chattisgarh and Orissa have chosen their common BCAs.

At the last SLBC meeting in May, it was felt that the BCA should be dealing with 1000-1500 households, or cater to a population of about 5000-8000.

In the hilly, tribal and desert areas or where distance is large, the banks could have lesser number of accounts keeping the geographical and other conditions under consideration.