How JAM Trinity will transform lending, propel growth
In CNBC-TV18's 'Indianomics' series,
Nandan Nilekani, Former Chairman, UIDAI; Mentor, Ispirt and Ashish Gupta, MD
& Head of Research, Credit Suisse discuss how Aadhaar, along with
government’s financial inclusion program and a smartphone will change the face
of banking system.
As of last year, as many as 60 percent of Indians did not have access to formal banking -- a statistic the Narendra Modi dispensation is keen to change. Last Budget, Finance Minister Arun Jaitley announced the JAM (Jan Dhan-Aadhaar-Mobile) Trinity, through which the government envisages it will revolutionize the way Indians transact. Further, recently, the Reserve Bank of India introduced the unified payment interface (UPI), which will enable all payments to be made through an SMS. As every purchase is made through Aadhaar enabled phones on the unified payment system, a zillion gigabytes of data will be available to banks on the spending habit and indeed the lifestyles of their customers. The father of Unique Identification Authority of India (UIDAI), Nandan Nilekani, believes that there will be a shift in business models and banking system from low volume, high value, costs and fees to high volume, low value, costs and fees. Not just this, Jan-Dhan, Aadhaar and Mobile (JAM) will lead to a dramatic upsurge in accessibility and affordability of credit. Extending the argument forward, brokerage Credit Suisse estimates that total consumer loans will rise from USD 600 billion today to USD 3 trillion in 10 years –that opportunity will be shared by the savviest public and private banks, the new banks and new age non-bank finance companies. Therein is also an opportunity. A five-fold jump in retail consumption can mean a five-fold jump in India's gross domestic product (GDP): a USD 10 trillion India will be a middle income country.
Read more at: http://www.moneycontrol.com/news/economy/363bn-opportunity-how-jam-trinity-will-transform-lending-propel-growth_7099701.html?utm_source=ref_article
As of last year, as many as 60 percent of Indians did not have access to formal banking -- a statistic the Narendra Modi dispensation is keen to change. Last Budget, Finance Minister Arun Jaitley announced the JAM (Jan Dhan-Aadhaar-Mobile) Trinity, through which the government envisages it will revolutionize the way Indians transact. Further, recently, the Reserve Bank of India introduced the unified payment interface (UPI), which will enable all payments to be made through an SMS. As every purchase is made through Aadhaar enabled phones on the unified payment system, a zillion gigabytes of data will be available to banks on the spending habit and indeed the lifestyles of their customers. The father of Unique Identification Authority of India (UIDAI), Nandan Nilekani, believes that there will be a shift in business models and banking system from low volume, high value, costs and fees to high volume, low value, costs and fees. Not just this, Jan-Dhan, Aadhaar and Mobile (JAM) will lead to a dramatic upsurge in accessibility and affordability of credit. Extending the argument forward, brokerage Credit Suisse estimates that total consumer loans will rise from USD 600 billion today to USD 3 trillion in 10 years –that opportunity will be shared by the savviest public and private banks, the new banks and new age non-bank finance companies. Therein is also an opportunity. A five-fold jump in retail consumption can mean a five-fold jump in India's gross domestic product (GDP): a USD 10 trillion India will be a middle income country.
Read more at: http://www.moneycontrol.com/news/economy/363bn-opportunity-how-jam-trinity-will-transform-lending-propel-growth_7099701.html?utm_source=ref_article
No comments:
Post a Comment