Rural marketing
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Transcript of Rural marketing
Two critical needs of rural people
• Micro saving
• Frequent withdrawals
Marketer challenge
• Low deposit
• Credit penetration
• Low average values
Financial Services in Rural
Poor access or usage of services
Economic state of the rural population
Lack of physical infrastructure facilities
Regulatory Constraints
Economics of the rural banking
Usage – illiteracy; incomplete service offering bybanks, high transaction cost in the formalbanking system
Banking Services
Financial Products distributed by two systems
• Branch Delivery
• Non-branch system
Non-branch system – mobile ATM, smart cards, mobile banking, SHG’s, MFI’s, Post offices & the business correspondent/facilitators model.
Banking Services
Business correspondent Model(BC)
• Under this model, the intermediaries chosen tospread banking services are called businessFacilitators
• Facilitators identify borrowers, process loansapplications, and create awareness
• Bank also uses NGO’s, microfinanceinstitutions, post offices, non-banking financecompanies and retired bank employees; andrecently petrol pumps, provision stores,pharmacies, fair price shops
Banking distribution channel
Is defined as the provision of thrift, credit andother loan products of very small amounts topoor people to enable them to improve theirquality of life.
SHG-Bank linkage model- SHG financed bycommercial banks, regional rural bank andcorporative banks.
MFI-Bank linkage model- MFIs financed bybanking agencies for on-lending to SHGs andother small borrowers covered under themicrofinance sector.
Microfinance
Kisan credit card- KCC is a revolving cash creditfacility with unlimited withdrawals and repayment,with the credit limit based on operational landholding, copping pattern and scale of finance.
KCC introduced by GOI in 98-99, aims to provideadequate and timely financial support from thebanking system to the farmers for their short termneeds, primarily for the agriculture.
It is in the form of a bank saving passbook.
Credit services
Non-life insurance - direct mail, direct sales force, insurance agents, agreements with corporations, banks, real estate companies etc
Life insurance companies - Agents
Distribution of Insurance Products
Banc assurance, brokers, direct selling agents, corporate agents such as NBFCs, NGOs, MFIs, SHGs
Private players ties with public-sector banks, corporative banks and RRBs
Tied up with HUL, ITC for e.g. – ICICI &
e-choupals
Micro-insurance
Emergence of new distribution channel
Harish Vasdev
CUHP13MBA29
MBA 3rd Semester (Marketing & Supply chainmanagement)
Central University of Himachal Pradesh
Email- [email protected]
LinkedIn- in.linkedin.com/in/harishvasdev
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