Reportedly, this initiative was introduced to digitise transactions of Svatantra Microfinance where in RBL Bank will be disbursing loans and HDFC Bank receiving the repayments.
This project was made possible with a simple innovative use of the Aadhaar Payment Bridge System (APBS) and USSD-based *99#infrastructure has made this possible, reported The Economic Times.
“Potential of such a system in MFI sector itself for digitisation of payments is as high as 80 million annual disbursements and over 900 million repayment transactions,” NPCI Managing Director and Chief Executive A P Hota said.
There are 268 MFIs dealing with over 40 million low income customers.
” Digitising cash based operations has the potential to bring a host of benefits to MFIs as it mitigates cash carrying risks and improves operational efficiency by saving time for frontline staff,” said NPCI.
“It can aid in the diversification of products offered to consumers and enable the innovation of customomer centric offerings based on critical insights sourced from digital data collected over time on customer behaviour,” it added.