Branchless Banking Solution
Branchless banking deals with providing easy access to financial services such as savings, investments, pension and insurance to the unbanked and under-banked segments of the population. Branchless banking is the concept of providing banking services outside the conventional bank branches by using information and communication technology services and third party organizations (commonly referred to as Business-Correspondents). Innoviti through its biometric handheld terminals, uniPAY soft switch and host provides complete solutions for branchless banking.
Branchless Banking Solution
Technology can enable banks and their customers to interact remotely in a trusted way through existing local retail outlets. Customers can be issued bank cards with appropriate personal identification number (PIN) - based or biometric enrollment security features, and the local store the "banking agent"can be equipped with a point-of-sale (POS) device controlled by and connected to the bank back end system using a phone line or wireless or satellite technology. With appropriate technology, the costs of bank service distribution can be reduced, while still effectively controlling banking risks. In its most basic form, a retail outlet serving as an agent for a bank is a transactional channel permitting bank customers to deposit and withdraw cash into or from their account, as well as to perform a range of electronic transactions, including inquiries on account balances or recent movements and money Transfers between accounts. The agent business can be set up so that neither the customer nor the bank needs to incur settlement risk with, or otherwise financially trust, the agent when transacting through it. Trust between the bank and the customer can be created through the Technology based transaction process.
Technology based transaction process ensures:
- Authentication of all parties Customer's cash transactions are offset against the agents bank account
- Real-time authorization of transactions
- Automatic receipt generation etc.
Through this technology based mechanism, the banking agent becomes a channel for exchange of cash and bank obligations between the customer and the bank. These transactions pass through the agents bank account in a way that exactly offsets the cash it has taken in or handed out to the customer. Trust in transactions flowing through agents is ensured primarily through the deployment of an appropriate technology, backed by a contract between the agent and its bank that specifies how the technology is to be used and their respective roles and responsibilities.
A typical architecture for branchless banking is shown in the architecture below. Innoviti provides various elements of this architecture. The front-end services can be provided through portable, biometric wireless terminals such as the Vx610-trueid or MagIC3M-trueID. The terminals carry a uniPAY client application that can support savings, withdrawl, sale, void, refund, settlement and other typical transactions. The transactions are routed to the uniPAY soft switch that is based on the ISO 8583 protocol. The switch then routes the transactions to the uniPAY host for customer account management. Innoviti's OLAP reporting system can also be interfaced to the host for analytical reporting. The various elements can be used independently with other banking systems or as an integrated end-to-end solution.
Benefits
- Cost-effective delivery through portable biometric wireless terminals
- Standard transaction set including savings, payments, insurance, investment and pension transactions
- Availability of biometric authentication for stronger KYC, with de-duplication and fraud control
- End-to-end solution with ISO soft switch and customer account management system