Dec 27, 2005, 05.16 PM | Source: Moneycontrol.com
State Bank of India launches Zero Balance No Frills account – ‘SBI TINY’
State Bank of India, India’s largest Bank today launched their new product ‘SBI TINY’, at Bahirgaon village near Aurangabad (Maharashtra). The product is a bold and innovative initiative to achieve financial inclusion by making banking easier and comfortable for the really small man. This is an improvised version of the ‘No Frills’ account, which the Reserve Bank of India had asked all banks to introduce. SBI believes that the target group which essentially consists of daily wage earners or those with meager monthly salaries are unable to travel long distances to the nearest Bank branch as this eats into their time besides the cost associated with it like bus fare, etc. SBI TINY aims at making Banking services available to them in an environment where they are comfortable and through people whom they know and trust.
The account will be a zero balance account. Even amounts as small as Rs.5/- can be deposited. The scheme envisages placing a drop box at the residence/office of intermediaries designated as SBI Mitras (or any other convenient location as the Bank may deem fit) in which the customers can deposit their cash placed in envelopes specially designed for this purpose. The SBI Mitra will typically be a retired school teacher, postal employee, SHG leader or any one who qualifies based on certain norms. The SBI Mitras will also be people who belong to the village. They will also identify potential account holders and help them in the account opening process. The important feature is that SBI Mitra will be a person who is respected in the village and one on whom the villagers repose confidence.
Mr. Ashok Kini, Managing Director and GE (NBG), State Bank of India, who launched the product at Bahirgaon said “SBI Tiny was inspired by RBI Governor’s basic drive for financial inclusion of everyone through initiatives like no frills account and our own strategic thinking on taking Banking forward. We in SBI see that every person who is an earning member in a family must have access to a Bank account. As a Bank with the largest network, we have a national charter to take Banking to everyone. The Bank structure in India today is a copy of western Banking system. There are many barriers to a person entering a Bank- social divide; language divide knowledge and digital divide have made this more difficult. In reality physically reaching out to every person is costly. Through SBI Tiny by working with the community we except to create a situation where people develop long term relationship with the Bank. This will be through a member of their own community whom they trust and respect- 1st at savings level, which should later be moved on to assets creation and then on to another products like insurance etc. This is a very special strategic initiative from SBI, which aims at talking the complex Bank out of banking and make banking easier to access. The initiative will be rolled out at more centers over a period of time”. He also added, “ the entire initiative is based on mutual trust and easy access and we are confident we will be able to reach out to more and more people”
The product launch today is a pilot launch. Based on response, SBI plans to roll this out across the country, official sources say.
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