Showing posts with label kisan card launch. Show all posts
Showing posts with label kisan card launch. Show all posts

Friday, August 8, 2014

Will PM Narendra Modi's financial inclusion plan use Aadhaar for authentication?

In less than two weeks, PM Narendra Modi is expected to announce a new Financial Inclusion drive.
However, even as the anointed day - the 15th of August - draws near, key aspects of this drive are still unclear.

 

The programme, called Sampoorn Vittiyea Samaveshan (SVS), seeks to add 20 crore new bank accounts. These will be linked to Aadhaar. They will probably provide an overdraft facility. And they will be used for cash transfers.

Go deeper into the details, however, and you encounter a set of unresolved questions. Prime among them, the role of Aadhaar.

While researching this story, ET reviewed two drafts produced by the Department of Financial Services - one in June, and the second in July. The draft dated 8 July, 2014, says: "This account would be linked with the Aadhaar number of the account holder and would become the single point for receipt of Direct Benefit Transfers (DBT) from Government/Local Bodies."

According to a source close to the UIDAI, who spoke to ET on the condition of anonymity, this phrasing suggests that while Aadhaar numbers might be seeded into bank accounts, it might not be used for authentication.

In other words, once the cash flows into the Aadhaar-linked bank account, last-mile authentication when the money is being withdrawn will be done using the authentication systems of either the relevant bank or the last-mile service provider - like a Banking Correspondent (BC) company.
Not using Aadhaar for last mile authentication has significant fallouts for the UIDAI. Which, among other things, has the Aadhaar-enabled Payment System as one of its key components, and sees authentication services as one of its principal functions and revenue streams.

Till now, the UIDAI has argued that Aadhaar-based authentication is needed to show that the DBT (Direct Benefit Transfer) has indeed reached the targeted beneficiary.

However, from the field, this claim has been marred by persistent reports that online biometric authentication is not working for manual labourers and the old. Agrees Sanjay Kuberkar, The founder of Adrenaline Financial Inclusion Advisors, "The biometrics do not always work."

Another reason the UIDAI wants Aadhaar-enabled authentication is because that will further inter-operatability. A person can use her biometrics to access her account through any BC, any bank.
Says the source close to the UIDAI, "If banks or last-mile providers use their own proprietary (biometric) authentication technologies, then there will be no inter-operatability." In other words, a person with an account in United Bank may not be able to use a BC working with State Bank of India to access his account.

This is where the debate gets complex. Aadhaar has defined standards for Micro ATMs and Biometric Capture. Banks and BCs adhering to those standards, with BCs who have plugged into the bank's core banking servers, can send authentication queries all the way to the UIDAI's central ID repository. In this design, a beneficiary can access her account through any service provider if they are Aadhaar-compliant.

But, banks too have been creating their own biometric databases. And the question is whether authentication requests where one bank sends one biometric authentication query to another bank can be as interoperable as the Aadhaar ones.

Under former DFS Secretary DK Mittal, the department ran such pilots in Haryana. These too were online biometric authentications but the biometrics were stored with the banks. But those, says the UIDAI source, failed.

However, another way to ensure interoperatability is to use PIN numbers instead of biometrics. It is here that a proposal in the SVS documents is interesting. It proposes that all account holders be provided with a RuPay card. Says Kuberkar, "The card works at any ATM, and does not require biometric authentication."

Counters the UIDAI source, "Biometrics are safer than PIN numbers.

In contrast, PIN numbers can be used also by those who have trouble with biometrics.
There is another reason why some banks want to retain authentication with them. Aadhaar was planning to start charging for authentication. A decision which has now been deferred to December.
Says Kuberkar: "Cost of Aadhaar authentication is an issue, even if the cost is kept at just 25 paise per authentication. There is at least one client bank of mine who is considering to use their own biometric authentication method instead of Aadhaar because of the cost implications."

What does this seeding/authentication debate mean for reducing leakages? According to MS Sriram, visiting faculty at IIM Bangalore's Centre for Public Policy, it is a good idea to use the Aadhaar number only for seeding. "Linking bank accounts with the Aadhaar number will help the government eliminate ghosts and duplicates from beneficiary lists."

Such a move, he says, also addresses the concerns around biometrics not working and privacy. "Using Aadhaar only for seeding also takes care of some privacy-related questions. A trail of a person's movements will not be available any longer at the central server."

About ten days ago, the Department of Financial Services (DFS) was expected to present an updated iteration of SVS to the Prime Minister. This was shortly after he reposed his faith in the UIDAI project. It is yet unclear what transpired in that meeting. The documents in the public domain pre-date that meeting. Emails to DFS officials seeking an appointment went unanswered.

However, based on conversations with UIDAI officials and Banking Correspondent (BC) companies, it seems there is little clarity on this question on how Aadhaar will be used.

Monday, July 28, 2014

Himachal Coop Bank launches RuPay Kisan Credit Debit Card

RuPay Credit Debit Card Launched

Shimla: To enable easy credit and debit facilities for the farming community, Himachal Pradesh State Cooperative Bank (HPSCB) today launched the RuPay Kisan Credit cum Debit card.
Bank authorities claimed that HPSCB had become the first cooperative bank in the country to introduce the service for its largely rural customers.

RuPay Credit Debit Card Launched

Launched by chief minister Virbhadra Singh, on the occasion he said, “HPSCB having kept pace with the changing times in banking services like introducing core banking solutions and now launching of RuPay credit debit card would go a long way in providing efficient services to farmers and other customers.”

Chairman HPSCB Harsh Mahajan informed that the Bank through its more than 207 online branches and extension counters was extending prompt and uninterrupted services, particularly to the farming and horticulturalist communities.

Being one of the first cooperative banks in the country to introduce ATM services, the management plans to open four new branches at Golthai in Bilaspur, Gattadhar in Sirmaur, Rajnagar in Chamba and Mandal in Shimla soon.

Besides licenses for starting nine extension counters at Kudu in Shimla, Nanawan and Kothipura in Bilaspur, Bir Road Ahju and Ropri in Mandi, at Obri and Sarol in Chamba, Kamlanagar and Matiana in Shimla have also been granted by Reserve Bank of India, said Mahajan.

Talking about the RuPay credit-debit card, Amitabh Awasthi, managing director HPSCB said that it would facilitate farmers to use their own money or the money loaned from the bank with ease for undertaking seamless transactions for buying agricultural inputs, such as fertilizers, pesticides or mechanized tools such as spray pumps, when required.

Earlier, Harsh Mahajan presented a cheque of Rs. 21,65,760 as dividend for the year 2012-13 and contributed a Rs 51 lakh cheque towards the Chief Ministers Relief Fund to Virbhadra Singh.

Nabard launches RuPay Kisan cards

National Bank for Agriculture and Rural Development (Nabard) today rolled out RuPay Kisan Card and RuPay Debit Card here today.


National Bank for Agriculture and Rural Development (Nabard) today rolled out RuPay Kisan Card and RuPay Debit Card here today.



"This is the first time that RuPay Card, which is in the nature of ATM cum Debit Card, is being issued by any cooperative bank in the state of Haryana," said Nabard Chief General Manager (Haryana) D V Deshpande.

He said the issue of RuPay cards by cooperative banks will enable them to improve their customer service and bring it on par with any other bank to farmers and other customers.

Meanwhile, Haryana Chief Minister Bhupinder Singh Hooda asked Nabard to increase the refinance given to cooperative banks from 50 per cent to 75 per cent.

Speaking on the occasion of its 33rd Foundation Day here today, Hooda said reducing groundwater level and shrinkage of fertile land posed big challenges which could be met by promoting piped and drip irrigation, constructing green houses, promoting dairy and techniques of vertical farming.
Hooda asked Nabard to work at the micro level for the expansion of these techniques and said it should provide finance for setting up water bodies in the state.

He said while Kisan Clubs have been set up in all sub-divisions of the state, there is a need to set up Kisan Clubs in all villages.

"Nabard should extend a helping hand in doing so. These clubs would act as a bridge between NGOs, self-help groups, farmer groups," he added.

Wednesday, May 14, 2014

With RuPay, India builds its own card payment network

President Pranab Mukherjee presenting an award to CEO, ICICI Bank Ltd. Chanda Kochhar during the launch of "RuPay" card in New Delhi on Thursday.

India takes on global players like MasterCard and Visa; Conceived by National Payments Corporation of India, RuPay card is accepted at all ATMs (1.6 lakh plus), 95% of PoS terminals (9.45 lakh plus) and most of the eComm merchants (about 10,000) in the country

New Delhi : President Pranab Mukherjee on Thursday dedicated to the nation indigenous card payment network called RuPay taking on the global players like Visa and MasterCard. It will work on ATMs and merchant outlets and help in reducing cash transactions.

The new payment network developed by the National Payments Corporation of India (NPCI), a not-for-profit company envisioned by the Reserve Bank of India (RBI) and created by the banking industry, covers all the automated teller machines (ATMs) and most of the retail and e-commerce platforms.

The RuPay platform is being used by certain banks like ICICI, State Bank of India, Punjab National Bank, among others, for clearing and settlement. RuPay, which works on three channels — ATMs, Point of Sales (POS) and online sales, is the seventh such payment gateway in the world.  A variant of pre-paid RuPay card would shortly be launched by IRCTC, which will help in booking railway tickets.

“RuPay” is the coinage of two terms Rupee and Payment.  “Dedication of RuPay to the nation is symbolic of the maturity of the payment system development in India,” Mukherjee said after formally launching the card at a function at Rashtrapati Bhavan.  He pointed out that with the launch of new system, India has now ranked among the “few countries in the world to have such a network built domestically to meet the card-based payment system needs of the country.”

The RuPay card is accepted at all ATMs (1.6 lakh plus), 95 per cent of PoS terminals (9.45 lakh plus) and most of the eCom merchants (about 10,000) in the country.

RuPay Scheme provides flexibility to card issuing banks to issue special purpose cards like Kisan Cards, Milk Procurement Cards, Grain Procurement Cards and Financial Inclusion Cards.

A variant of the card called “Kisan Card is now being issued by all the Public Sector banks in addition to the mainstream debit card which has been issued by 43 banks”.   More than 150 cooperative banks and the Regional Rural Banks (RRBs) in the country have also issued RuPay ATM cards. The total number of cards issued as on date is 17 Million and is growing at a rate of about three million per month.

NPCI Chairman Balachandran M said the NPCI board plans to take RuPay card overseas and is already in talks with Discover Financial Services in the US and JDC in Japan for partnership.
Speaking on the occasion, Financial Services Secretary G S Sandhu said RuPay would be available at a cost which is much less than those of international cards.

For clearing and settlement of each transactions, banks will have to pay 40 per cent lower fees in RuPay platform compared to other international platforms. Public sector banks have already installed 25,331 RuPay cards enabled ATMS and 9,000 more ATMs would be installed in the current fiscal, Sandhu said.

Monday, May 12, 2014

RuPay will reduce dependence on cash transactions: Pranab Mukherjee

Dedicating 'RuPay' card to the nation, Mukherjee said for a large country like India, volume of card transactions will be significant in the years ahead.

Dedicating 'RuPay' card to the nation, Mukherjee said for a large country like India, volume of card transactions will be significant in the years ahead. 

NEW DELHI: President Pranab Mukherjee said 'RuPay'-- India's payment gateway -- will reduce dependence on cash and help in streamlining the card payment systems in the country.

Dedicating 'RuPay' card to the nation, Mukherjee said for a large country like India volume of card transactions will be significant in the years ahead.

RuPay will not only reduce dependence on cash, but will offer users diverse set of payment option within the country, he said, adding India is one of the few countries in the world to meet the card payment system needs domestically.

A variant of pre-paid RuPay card would shortly be launched by IRCTC, which will help in booking railway tickets. RuPay is developed by National Payments Corporation of India (NPCI) and would be the seventh such payment gateway in the world.

NPCI Chairman Balachandran M said the NPCI board plans to take RuPay card overseas and is already in talks with Discover Financial Services in the US and JDC in Japan for a collaboration.

RuPay works on three channels - ATMs, Point of Sales (POS) and online sales. Speaking on the occasion, Financial Services Secretary G S Sandhu said RuPay would be available at a cost which is much less than the cost of international cards.

The public sector banks have already installed 25,331 RuPay cards enabled ATMS and 9,000 more ATMs would be installed in the current fiscal, Sandhu said. The RuPay card is accepted at all ATMs (1.6 lakh plus), 95 per cent of PoS terminals (9.45 lakh plus) and most of the eCom merchants (about 10,000) in the country.

Since the transaction processing will happen domestically, it is expected to lead to lower cost of clearing and settlement. Banks Will pay fees in Indian rupees instead of foreign currency.

A variant of the card called 'Kisan Card' is now being issued by all the public sector banks in addition to the mainstream debit card which has been issued by 43 banks. Further, a separate card for payment of milk purchases has also been launched.

The total number of banks issuing RuPay cards is now more than 250 and the card base as on April was at 20 million plus. More than 150 cooperative banks and the regional rural banks (RRBs) have also issued RuPay ATM card.

RuPay, a new card payment scheme, is the coinage of two terms Rupee and Payment. RuPay card offers personal accident insurance and permanent disability cover of Rs one lakh to the cardholder, subject to the card being kept in activated condition.

Such a feature is not present on any international card scheme, a statement said.

Monday, March 31, 2014

Axis Bank offers crop loans at ATMs on Kisan card



Private lender Axis Bank, launched its ‘Kisan Card’ to facilitate easy agriculture lending to farmers through ATMs. 

The electronic Kisan Card on the RuPay platform, will be offered to farmers or agrarian customers of the bank on their cash credit crop loan accounts. The offer will provide the convenience of visiting any ATM for cash withdrawals instead of visiting the branch. 

“The card provides queue free, 24x7 disbursement facility for farmers, allowing them to use their loan limit by withdrawing cash up to Rs 1 Lakh per day, in the required quantum, as and when required, thereby reducing their interest burden and negating the risk of carrying higher volumes of cash,” the bank said in a statement. 

R K Bammi, Executive Director – Retail Banking, Axis Bank said, “The launch of Kisan Card is a significant step towards introducing a branch-less, convenient and secure banking solution to the Agrarian consumer. Normally debit cards are linked to a Savings / Current account. In this case, Kisan Card is linked to the farmer’s Crop Loan account, which negates the need to go to the branch to transact. Almost 90-95 per cent farmers currently use the branch as an interface; we expect about 30 - 40 per cent farmers to migrate on to using this alternate channel actively.”

Axis bank launches Kisan Card




Over a decade after the state-run banks launched Kisan Credit Cards, private sector lender Axis Bank today introduced its own card which is aimed at helping farmers access liquidity round-the-clock.

The bank, the third largest from the private sector space in the country, launched the "Kisan Card" through which a farmer can withdraw up to Rs 1 lakh per day from automated teller machines (ATMs), it said in a statement.

The card will be offered to agrarian customers on their cash credit crop loan accounts and will also help them reduce the interest burden as the interest payments start after drawal of the money, it said.

The bank's executive director and head of retail banking, R K Bammi, said at present 90-95 per cent of such customers come to the bank branch for transactions and the bank expects 30-40 per cent farmers to migrate to this alternate channel.

It can be noted that the Kisan Credit Cards scheme was introduced in August 1998 and since then, a host of banks, a majority of them in the state-run space, have launched such cards.

In the statement, Axis Bank claimed it is "first new generation private sector bank to launch an electronic Kisan Card on the RuPay platform."