NEWS & ADVICE : FIXED DEPOSITS
FinMin recommends for a better pay to Biz Correspondents
By Neelima Shankar
May 23, 2012
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The finance ministry has recommended an increase in the pay of business correspondents (BC), the facilitators of the financial inclusion.

The new basic salary for the BCs would be Rs. 2500, besides which they will receive a commission per transaction they carry out. Opening of a fixed /recurring deposit would give them Rs. 5 per transaction while for opening a savings bank account the commission would be Rs. 20.

Prior to this the BCs were paid a performance based pay, which was between Rs. 1500 to Rs. 2500. This was one of the primary reasons of a very high attrition rate of 40%. The bankers now feel, the system will eventually become a ‘one cluster/State, one technology provider' model.

However, the move will almost double the costs to the banks, in addition to it the Fin Min has suggested a hike of 10% after 3 years.

The Department of Finance has divided the nationwide banking into 20 clusters and asked 12 large banks to come out with a request for proposal (RFP) for technology providers. Some of these banks are Bank of Baroda, Syndicate Bank, State Bank of India, Punjab National Bank, and Indian Overseas Bank.

SBI has already started a pilot project in the state of Maharashtra on the lines of ‘one State/cluster, one technology provider', where the technology provider/leader bank would carry out the banking facilities in the villages through BC agents.


 


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