This report evaluates the factors shaping the adoption of digital financial services by emerging consumers in India and assesses the crucial role that frontline banking agents play in helping to successfully transition their clients to digital platforms. 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).

The evaluation of agent effectiveness in India considers 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 report also demonstrates 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, business correspondent agents have the right combination of resources, knowledge, and motivation to help consumers 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.

Misha Sharma

Project Manager, IMFR Lead

Misha Sharma is a Project Manager at IFMR Lead. She works with the Financial Inclusion team and is currently leading projects based out of South India evaluating the impact of access to finance on the overall well-being of the rural poor. Her research work primarily focuses on studying alternative channels of financial services for the poor. Prior to joining IFMR Lead, Misha worked with Goldman Sachs as an Operations Analyst. Misha holds a Master’s Degree in Economics from University of Edinburgh and a Bachelor’s Degree in Economics from Stella Maris College, Chennai.

Shreya Chatterjee

Senior Research Associate, IMFR Lead

Shreya is a Senior Research Associate with IFMR Lead’s Financial Inclusion team. Shreya has worked on impact evaluations of alternative financial delivery channels and livelihood rehabilitation programs, in partnership with NGOs. She is currently working on an exploratory study mapping digital financial services for the underserved in India. She has an undergraduate degree in economics from Singapore Management University.

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