Sahamati, under the aegis of NABARD conducts AA workshop for Regional Rural Banks and State Cooperative Banks

30 May 2022

The Ministry of Finance along with the Department of Financial Services have been encouraging financial sector entities across sectors to join the Account Aggregator Ecosystem which has the potential to reform the financial services delivery taking forward the transformation ushered in by other digital initiatives such as Aadhaar and later by UPIs. 

In this context, Sahamati Team conducted a workshop in June 2022 for Regional Rural Banks and State Cooperative Banks taking them through the Account Aggregator Framework and discussing the potential value to the citizens and lenders. The workshop was held under the aegis of NABARD, chaired by Shri Shaji KV, DMD. The participants included senior management teams from 5 Regional Rural Banks and 5 State Cooperative Banks. 

The event is special as, for the first time, the grass root financial institutions  came together to brainstorm the potential benefits of Account Aggregator on empowering low income and rural citizens with an easy, digital consent based data sharing mechanism. RRBS and StCBs  are entities that serve the customers that are traditionally excluded from financial services due to lack of adequate, easy and high quality data for underwriting and high cost of operations and processing given extremely small ticket sizes.

The Workshop concluded with a clear resolve from the participating banks to take forward the policy agenda of financial inclusion. Few specific issues that were discussed and may need further interventions included:

  1.  Request to NABARD to work out  differential pricing policy for Rural Financial Institutions to allow them to use the Account Aggregator Ecosystem at an affordable cost
  2. Conceptualise workable use cases for the target customer segments for RFIs, who may have a bank account which has low levels of transactions on or the customers may not be digitally savvy to be able to participate in the system. In this context, a proposal to explore Assisted Account Aggrgeator as an alternative to self serve mode was made
  3. NABARD to provide technical and commercial support to Rural Financial Institutions that are behind the curve in terms of their technological preparedness