A Little World: Facilitating Safe and Efficient Mobile-Banking in Rural India

Bimal Arora, Ashley Cummings

Research output: Book/ReportCommissioned report


This study is about a private initiative to process and streamline rural financial payment transactions conducted by public and private institutions in India. The initiative is led by a private sector organization, A Little World (ALW) and its sister entity, a non-profit organization, ZERO Microfinance and Savings Support Foundation (ZMF). ALW and ZMF act as intermediaries between rural communities at one end, and mainstream financial institutions and the government at the other end. ALW offers a secure, low-cost technology driven delivery platform for financial services through special mobile phones that store and help manage a vast amount of customer bank account data, authenticates account holders through photo and biometric identification and allows access to the bank accounts as the Point of Service terminals. The mobile phone is in essence a ‘bank in a box’ run by ZMF for the villagers in rural India. The services currently offered by ALW/ZMF include: cash deposits, withdrawals and transfers (as in bank saving accounts), payments for government social security programmes and welfare schemes electronically – what is generally called the Electronic Benefit Transfer (EBT), disbursal and collection of loans and loan installments, collection of cash for third parties, insurance products and premium payments and payment of utility bills. Thus, ensuring that the financial transactions are safe, reliable, convenient and transparent and there is no funds leakage in the process.

ALW with its technology platform, and a new reform in the banking policy, that allows the non-profit making entities (Business Correspondents) to function as intermediaries of mainstream banks in rural areas, fills a much needed gap for the rural households in India by offering convenient access to affordable financial services. ZMF acts as the Business Correspondents (BC) for leading private and public sector banks in India.

Since its pilot project in 2006, with India’s leading bank, the State Bank of India, ALW and ZMF have rapidly grown and are now present in 22 states, with over four million rural customers, 8,314 points of presence and an average of 25,000 new account openings every day. ALW and ZMF’s services in rural India, in tandem with formal financial institutions and government, may mark a new beginning for rural households in the annals of financial inclusion. No surprises on ALW being ranked among the top ten most innovative companies in India in the annual Most Innovative Companies ranking of the US-based Fast Company news magazine.
Original languageEnglish
Number of pages43
Publication statusPublished - 2010

Bibliographical note

Copyright @ 2010. United Nations Development Programme .


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