De-congesting its branches

You can into any bank, but mostly public sector banks on any morning and you could feel that you have inadvertently landed onto a railway platform. The milling crowd is so much that it makes you wonder whether we Indians have taken to online banking at all. Most of the people there would have come to either withdraw cash or put in a cheque or simply to ‘enquire’ about something and generally spend time with known acquaintances. Those in a tearing hurry get frustrated, leading to frayed nerves and eventually some exchange of heated words.

State Bank of India has fortunately noticed this and has planned to move low-value and high-volume transactions from the branch channel to the business correspondent/customer service point channels to ‘decongest’ its branches. These business correspondents could be the post office or a cooperative or even an individual who will be appointed by the bank, basically to act as an agent. This agent will provide basic banking facilities like opening bank accounts, accepting deposits and disbursing money. These ‘customer service points’ will have Point of Sale machines which will help the agent identify the customer by means of finger prints/smart cards.

This sounds like a good plan but the moot point is – will these PoS machines work sans electricity? Because most of India has a shortage of power and if this is the plan to get rural customers going, then it could become a challenge. But interestingly, RBI has done a survey of number of people visiting its branches and stated that the average number of customers per bank branch is 13,400, varying State-wise, with Chandigarh having 4000 customers in one branch while those in Nagaland have 26,000 customers and Manipur around 33,000.