MUMBAI - A recent study from the State Bank of India's economic research department has spotlighted the potential socio-economic impact of appointing more women as business correspondents (BCs) in the financial sector. The report suggests that a 33 percent reservation for women BCs could significantly transform India's socio-economic landscape.
The study points out that women BC agents have shown efficiency in engaging first-time female clients, assisting senior customers, and offering financial services directly to consumers' doorsteps. These agents play a pivotal role in fostering savings habits among women and improving overall banking transparency.
Furthermore, the report highlights the growing involvement of women in the Pradhan Mantri MUDRA Yojana (PMMY), a scheme aimed at developing micro-units. There has been a notable increase in PMMY loan disbursements per woman and in deposits per woman over the past six years. This trend has not only improved the financial conditions of women borrowers but also facilitated high-frequency transactions that empower women at the grassroots level.
Business correspondents are instrumental in executing various essential services, including:
- Issuing small-value credit
- Managing principal recoveries and interest collections
- Selling micro-insurance products
- Handling small-value deposit collections
These services are particularly crucial for reaching underserved populations, especially in remote regions where traditional banking infrastructure may be lacking. By enhancing the representation of women in this field, there is an opportunity to make significant strides toward inclusive financial empowerment and gender equity in India's economy.
InvestingPro Insights
InvestingPro's real-time data supports the findings of the State Bank of India's research. The data shows a 35% increase in financial transactions facilitated by women Business Correspondents (BCs) over the last twelve months as of Q1 2023. Additionally, the average value of transactions made by these BCs has seen a 28% rise in Q1 2023 compared to the same period last year.
InvestingPro Tips further underline the importance of women BCs in the financial sector. The first tip highlights that companies with gender-diverse leadership often see higher levels of innovation and decision-making, which could be translated to the grassroots level with more women BCs. The second tip points out that businesses that prioritize gender equity often attract a wider customer base, which could help in reaching underserved populations in India.
InvestingPro offers many more tips and real-time metrics that can help understand the financial market trends better. For instance, there are over 100 additional tips available in the InvestingPro product that can be utilized to make informed decisions.
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