Banking Services: Contactless Cards to Improve Access to Banking Services in India
- NXP Semiconductors partners with technology service provider Glodyne Technoserve to improve Indian rural communities’ access to banking services as well as their purchasing power through deploying e-Shakti contactless cards likely to be used as ID cards and payment cards at “virtual banks” based on handheld terminals (deploying physical branches will not be necessary). This initiative concerns the Northern Sate of Bihar.
- The NXP NFC-compatible terminal includes a biometric sensor for safer identification of cardholders (individual data being stored on this physical medium). This equipment is connected via GPRS or GPS to the bank’s central server.
- The State of Bihar counts over 100 million people, 85% of which are based in rural areas.
- India is particularly affected by underbanking, as such, this large-scale market has already been invested by several manufacturers focusing on improving access to banking services (NCR for instance, is one of these players). Financial institutions, for their part, are trying to capture new customers and enter rural areas which used to be underexploited (see Corporation Bank’s initiative for example, October 2011 Insight).
- According to Glodyne Technoserve, the lifespan of these cards accounts for their selection, as does their cheaper deployment and maintenance cost (compared to mag-stripe cards or smart cards).
- The e-Shakti project complies with the recommendations of the National Rural Employment Guarantee Scheme (NREGS) and aims to favour overall employment of under-skilled workers.