India is witnessing a profound transformation in its rural banking sector, driven by the Bank Sakhis - a cadre of women revolutionising digital payments in the hinterlands. This comprehensive blog delves into the inception, impact, and future prospects of the Bank Sakhi model, highlighting its significance in India's journey towards digital financial inclusion.
The Genesis of the Bank Sakhi Model
In 2015-16, under the National Rural Livelihood Mission (NRLM) and with the support of the World Bank, the Bank Sakhi model was introduced to bridge the rural-urban digital divide in banking. The model capitalises on the high proportion of women amongst Pradhan Mantri Jan Dhan Yojana (PMJDY) account holders in rural and semi-urban areas. By engaging women from self-help groups as Banking or Business Correspondents (BCs), the program aimed to bring essential banking services to areas devoid of physical bank branches​​​​.
Who can be a Bank Sakhi?
Membership in a Self-Help Group (SHG): The applicant should have been an active member of a Self-Help Group for a minimum duration of 12 months. This requirement ensures that the candidate has adequate exposure to group dynamics and financial activities typical of SHGs.
Age Requirements:Â The ideal age range for a Bank Sakhi is between 22 and 45 years. This criterion is set to ensure that the candidates are mature enough to handle the responsibilities that come with the role while being young enough to adapt to new technologies and processes.
Educational Qualifications:Â Preferably, the candidate should be literate, with a minimum educational qualification of having passed the 10th or 8th standard. This requirement is crucial as the role demands good reading and writing skills for efficient handling of banking transactions and related documentation.
Community Representation: A Bank Sakhi should be a representative of her community rather than the bank. This aspect is vital as it underscores the role of a Bank Sakhi as a bridge between the banking sector and the rural community, ensuring that the services are tailored to the community's specific needs and circumstances.
Source : CGAP
Training and Empowering the Bank Sakhis
Over 100,000 women across 20 states have been trained as Bank Sakhis, equipped with modern tools like Micro-ATM devices and smartphones. These women facilitate secure digital transactions and educate their communities about the benefits of digital payments, playing a pivotal role in enhancing digital literacy in rural India​​​​.
The Impact in States like Bihar, Odisha, and Madhya Pradesh
The success of the Bank Sakhi program has been particularly noteworthy in states like Bihar, Odisha, and Madhya Pradesh. During the pandemic, Bank Sakhis were instrumental in facilitating the digital transfer of Covid-19 relief packages, thus playing a critical role in raising awareness and providing doorstep access to financial services. This initiative significantly benefited over 200 million women account holders under the PMJDY, highlighting the Bank Sakhis' role in promoting financial inclusion during critical times​​​​.
Addressing Challenges and Building a Sustainable Model
Despite their successes, Bank Sakhis face significant challenges. Representing less than 10 percent of the total BC network, they often deal with mobility and safety concerns, financial constraints, and the challenge of balancing dual responsibilities. To sustain their effectiveness, strategies including liquidity assistance, social security benefits, risk coverage for travel, and addressing technical issues in banking infrastructure are essential​​​​.
National Recognition and the Road Ahead
The 'Samarth Campaign', aimed at promoting digital transactions in 50,000 gram panchayats, underscores the vital role of Bank Sakhis in India's digital financial inclusion. With ongoing support and improvements, they are key to driving a brighter future for rural India. The potential of this model is vast, offering a blueprint for other nations striving for digital financial inclusion and women's empowerment​​​​.
The Bank Sakhis are more than facilitators of digital transactions; they are empowering agents of change in rural India. Their efforts in bridging the digital divide, enhancing financial literacy, and supporting women's empowerment are critical. As India continues its journey towards greater digital inclusion, the role of Bank Sakhis will be increasingly crucial, embodying the spirit of inclusive growth and empowerment.