Agents of Change: How the Human Touch Is Bringing Digital Financial Services to New Customers in India

Despite significant progress toward digital financial inclusion in India, agents still matter for bringing low-income consumers into the digital financial services world.

CFI Fellows Misha Sharma and Shreya Chatterjee evaluate the factors currently shaping the adoption of digital financial services by emerging consumers in India and assess the crucial role that frontline banking agents play in helping to successfully transition their clients to digital platforms. The authors find that despite significant progress toward digital financial inclusion in India, agents still matter for bringing low-income consumers into the digital fold. Specifically, while agents largely assist with product adoption and use, their value to the financial sector and the financial institutions they represent goes beyond these responsibilities—they are the key to building trust, resolving problems, and ensuring value for customers. The report also articulates the state of agent practice in India and outlines 10 principal insights on training, equipping, and promoting financial product awareness among agents within the three types of assessed institutions—commercial banks, payment banks and microfinance institutions (MFIs).

In their evaluation of agent effectiveness in India, Misha and Shreya consider the following criteria:

  • Adequate Resources. Do agents have sufficient technical, financial, and administrative resources?
  • Awareness and Knowledge About Digital Financial Services. Do agents have the knowledge to make customers aware of the existence and uses of digital products, and build trust in the process?
  • Motivation. Are agents willing and motivated to spend the time needed to promote awareness and assist customers?

These factors—resources, knowledge, and motivation—ensure that agents can effectively assist novice digital financial services customers and convert them into habitual users, and are therefore clear priorities for the financial services providers the agents represent. The authors find that the degree of resource availability differs by institution type and affects the agents’ ability to assist customers with digital financial services in various ways. Ultimately, the authors find that business correspondent agents have the right combination of resources, knowledge, and motivation to help customers transition to digital financial services; credit officers (the “agents” of MFIs) are well-positioned to influence their customers once MFIs avail these services; and payment bank agents are least able to influence their clients to adopt or use digital financial services.







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