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Beyond the Stereotype

Building a Deeper Understanding of the Last Mile Customer

One-size-fits-all can help with widespread access but also creates barriers

Financial inclusion initiatives such as the Jan Dhan, Aadhaar, and Mobile (the JAM trinity) across India have yielded impressive results, opening over 519.5 million bank accounts till 2024. A staggering 13.9 billion transactions are processed monthly over UPI. However, these impressive figures mask a crucial challenge: reaching rural customers with limited resources. Initiatives like JAM have undoubtedly increased access to financial products, but for many in remote areas this has largely been limited to basic bank accounts rather than a full suite of financial products. 

Take Lakshmi, a tea seller from Rampur, a remote village in Bihar, who holds a Jan Dhan account, opened with the help of a banking correspondent. While she has an account, the nearest bank branch and ATM are miles away, and Lakshmi struggles to find the time and expenditure to visit the bank. Using her account for regular, basic transactions like sending and receiving payments remains a challenge.

Similarly, Rajni, a small-scale farmer from Akola in Maharashtra, is not able to register for an upcoming farm-to-home e-commerce platform due to limited digital literacy. KYC linking, a crucial step to receive online payments, feels like a foreign language to her. Unlike tech-savvy youngsters, the process of uploading documents and navigating online verification presents a significant obstacle.

While increasing account numbers is critical as a foundation to inclusion, it is not enough. Rural residents like Lakshmi and Rajni continue to face a range of barriers specific to their context that hinder their full participation in the financial system. Tailored solutions that are designed keeping these unique challenges in mind, are key to unlocking true financial agency and building a brighter future for all.

The Challenges of a Homogeneous approach 

  • The Digital Divide creates varied barriers for different users: Given the vast number of people without basic access and bank accounts, financial inclusion efforts have typically focused on bank account coverage. However in the past few years, the Indian financial ecosystem has seen revolutionary changes through digital channels, creating further hurdles for last mile customers. A daily wage labourer from a remote village with a bank account with limited internet access and a language barrier render online banking tools frustrating and inaccessible. This scenario exemplifies why focusing solely on “access” overlooks the real-world challenges faced by a heterogeneous population. A voice assistant feature or short tutorial videos in local languages for those with limited digital literacy, or local agents for areas with limited infrastructure, or financial products such as micro-saving plans that align with existing cultural practices. Only by understanding these nuances and implementing tailored sub-solutions can we empower individuals to actively manage their finances and achieve true financial inclusion.

  • Tailored nudges are needed to bridge the “Intent-to-Action” gap: While opening bank accounts is a crucial first step, regular usage and moving towards true financial agency  requires a deeper approach. The “Intent-to-Action” gap often persists, where people understand the benefits but struggle to translate knowledge into consistent financial behaviour. It is crucial to bridge this gap by tailoring financial literacy programs to specific needs, such as offline workshops or SMS information to help understand the banking process, low-bandwidth apps that need minimal data usage, vernacular voice assistance etc. can help empower individuals to move beyond account ownership and actively manage their finances.

  • Tailoring for rural realities: The ‘one-size-fits-all’ approach further complicates the issue by failing to capture the diverse needs and realities within rural communities. For example, while approaches might target a homogenous segment of rural women in the age group 18-60, the way a young recently married housewife engages with financial services might be very different from how an older woman who is a mother of 3 and manages household expenses. 

Moving beyond stereotypes to help customers advance on their individual journeys to financial resilience 

True financial resilience requires a holistic approach that goes beyond account opening. For a user like Lakshmi, better offline functionalities, language options or voice-based features can help her manage digital channels, despite limited literacy.  For Rajni, a simplified verification process through integration of existing government IDs, assisted verification by local banking agents, vernacular training videos, can help unlock access to new opportunities.

Addressing these diverse needs through user-centric design and financial literacy can help build a more inclusive financial ecosystem that empowers all to navigate financial hurdles, build resilience, and achieve their unique goals.

At Swadhaar, we recognize a one-size-fits-all approach is not enough. Through immersive behaviour science focused research we are building on our extensive training experience to build a deeper understanding of different barriers, enablers and nudges to customer behaviours. 

  • Engagement with money: How do they manage and perceive money?
  • Household decision-making: How are financial decisions made within families?
  • Digital access and comfort: What are their experiences with digital services?
  • Motivations and anxieties: What drives their financial goals? What are their financial fears?

The data-led approach allows us to test and curate content and standardise delivery of the financial literacy interventions ensuring tailored solutions reach diverse audiences effectively, while maintaining a foundation of quality and consistency. In the journey towards financial inclusion, prioritising our user-first approach aims to empower users like Lakshmi and Rajni to build confidence and take that critical next step in their own unique journeys to financial agency. 

Follow our research series “Banking on Her” here to read more about our work and insights, as we delve deeper to unpack and move beyond the stereotype.

Work Cited

  • (“Jan Dhan Yojana: 3.3 Crore Bank Accounts Opened in FY24, Cash Level Rises by Rs 36K Crore,” 2024)
  • (“UPI Transactions Rise 49% Y-O-Y to 13.9 Billion in June,” 2024)
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