Rural Service Mktng
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Transcript of Rural Service Mktng
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TELECOM SERVICES IN
THE VILLAGES
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AN OVERVIEW
The expansion of India's telecom industry has ledto an "all-inclusive growth" of the Indian economyin terms of GDP
In the 2006/07 the country saw the growth ratehit 9.6 percent-Majorly due to telecom sector.
The demand for telecommunication services aresurging across rural India, as middle class andupper classes are growing in most villages
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OPPORTUNITY IN RURAL INDIA
y A huge population 720 million people lives in
630,000 villages
y A massive economy over 50% of Indias totalGDP. There are almost same number of middle to
high income households in rural areas as urban India
y A parallel economy with the same needs as
developed markets but a reduced ability to pay.
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GAP BETWEEN URBAN AND RURAL
No celebrities will work
No mass media coverage
-Due to lack of access to technology
Rural market lies in the bottom of the Pyramid.
The 4 As workfor them
Availability
Affordability
Acceptability
Awareness
Product Categories
Sim selling
Paper voucher recharging
E- recharging
P.C.O. connections
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COMMUNICATION HELPS
y Lack of transportation-Coordinated rural transportation based on mobile information delivery,
will increase convenience and allow users to find reliable, regular andaffordable transportation on-demand.
y Difficulties in managing commercial transactions
-Micro-commerce ventures like mobile ordering, payments and deliveryrequests can all help isolated small-scale entrepreneurs in remotelocations.
y Lack of healthcare services
-Telecom and broadband intervention will allow doctors, nurses andmidwives to stay in closer contact with patients.
y Ignorance of governance policies
-Rural governance services giving access to citizen data will allow the ruralpopulation to be more informed about national level developments and
reduce the urban-rural divide.
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IDEA
Has good network in the village
Availability is high but the distribution is not wellchannelized
Branding is seen in and around the village- not
extensive
The amount that people spend is Rs 10/- to as max.they can.
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AIRTEL
Is favored in one village and not in the rest
The network is good in villages because of the
existence of a tower
Availability is high, but distribution is poor
Very poor branding around the villages
The spending of the people remain the same
irrespective of the network
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VODAFONE
Not favored by the villagers
Usage rate of Vodafone is extremely lowbecause of poor network
Availability is not as high as that of Idea and
Airtel. This is because of low demand
Huge amount of branding is done all around
the villages and district
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DISTRIBUTION
Well channelized distribution
- Direct distribution to the rural market
Trade discount and trade promotions
- Incentives to the shopkeepers for branding and
meeting sales target
- prizes
Tie-up with a mobile company for low cost
phones to be distributed
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PROMOTIONS
y Womens initiative
- Educate them in the village to encourage sales
- Special schemes , e.g. speak to the ancestral home free ofcost
- Interaction with women on Mondaysy Festival branding
- The service provider can brand the pandals
- Built kiosks
y Cultural fairs, dramas and respected community eldersy Fairs and weddings
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PROMOTIONAL STRATEGIES
Communicating and changing quality perception
- Value for money
Communication in Indian language
Exploit social and cultural values
- Sensitive people
Talking about a normal Indian
- Base advertisements and interactions on normalIndian families
Marathi names for the schemes
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CSR ACTIVITIES
Product Categories
Sim selling
Paper voucher recharging
E- recharging P.C.O. connections
Workshops to educate the children in the villages
- The best performer gets a mobile phone with sim card Sponsor cricket tournaments
- The target audience is the youth
Medical check ups twice in a year
- This will help the villagers to connect with the brand
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INSURANCE SECTOR IN RURAL AREAS
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India has been known as the land of villages
inspite of growing rate of urbanisation and
migration.
Why INSURANCE is needed?
As responsible family members who have a
commitment to provide for near and dear ones even
if we are no more. Life insurance is a product onemust think about and take action
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The bottom of pyramid are poor people who live
on an income of less than Rs 50 a day.
No companies has tapped this market to the fullest.
IRDA established a act of parliament in 1999,
made a provision that acquistion of certain amount
of rural as well as urban area is mandatory by
every company. Rural insurance offers a ready opportunity for
growth and increased volumes.
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IRDA norms on Rural Insurance
IRDA implemented compulsory targets for making
insurance coverages to rural and social deprived
sections of the society.
In addition to the coverage to the rural population ,
the regulation has required mandatory insurance
coverage for population falling under social
sectors. Social sectors are agricultural labours ,road
construction workers, fishermen etc.
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Rural insurance needs
Preference of rural household- viewed as a means
to save money to meet long term goals,
Ex- land and daughters marriage. View LI as reliable and essential form of saving.
People prefered endowment products with a policy
terms of 25 yrs and above
Irda has requested companies to design innovative
products for rural market.
LIC assured in rural areas is below rs 100000.
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Issues
Ability of rural policy holders- to pay premium paymentson regualr basis without interuptions.
Operational issues- lack of proper documentation at
the time of issuing policy. Issues with collection and remittance of premuims
accurately
Verifying the claims in rural areas are time consuming
and expensive.
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Efforts of private players-
Most cos have started their business in metros
TATA AIG- have come up micro insurance schemes
for rural market
Navkalyan yogna- regular premium payment,low
cost term plans
AYUSHAMAN yojana-single premium at a single
term. TATA AIG insurance company has accounted for
11% growth of life polices in march 2002.
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Strategies ...
Tailor made insurance products- low cost term
insurance produts tailored for rural sector.
Creation of new distribution links-
Lic has agents in rural areas
Whereas privated cos has preferred bancassurance
such as RRB
Tie ups- cooperative banks and RRbs has readyaccess to rural population and their homogeneous
nature make them ideal for sale`
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Conclusion
The rising of rural purchase power,opening up
economy,govt drives,and rural infrastructure is the
key drivers which would help to capture the
untapped and potential market.
Thus govt policies facilitate the process,key drivers
would lie on NGOs,SHGS,BANKS and atlast both
public and private sector banks would help tosafeguard and prevent poor from uncertainity in
future.
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BANKING SECTORS IN RURAL
AREAS
Rural banking in India started since the establishment
of banking sector in India. Rural Banks in those daysmainly focused upon the agro sector.
Today, commercial banks and Regional rural banks inIndia are penetrating every corner of the country are
extending a helping hand in the growth process ofthe rural sector in the country.
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Structure of regional rural bank
The establishment of the Regional Rural Banks(RRBs) was initiated in 1975 under the provisions ofthe ordinance promulgated on 26.9.1975 and
thereafter Section 3(1) of the RRB Act, 1976. The issued capital of RRBs is shared by Central
Government, sponsor bank and the StateGovernment in the proportion of 50%, 35% and
15% respectively.
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RRBs established with the explicit
objective of:
* Bridging the credit gap in rural areas
* Check the outflow of rural deposits to urban
areas
* Reduce regional imbalances and increase ruralemployment generation
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ROLE OF RBI IN RURAL CREDIT
Since it was set up in 1934, RBI has been taking keen interest in expandingcredit to the rural sector. After NABARD was set up as the apex bank foragriculture and rural development, RBI has been taking a series of steps forproviding timely and adequate credit through NABARD.
Scheduled commercial banks excluding foreign banks have been forced tosupplement NABARDs efforts-through the stipulation that 40percent of netbank credit should go to the priority sector, out of which at least 18 percentof net bank credit should flow to agriculture. Besides, it is mandatory thatany shortfall in fulfilling the 40 percent target or the 18 percent sub-targetwould have to go to the corpus Rural Infrastructure DevelopmentFund(RIDF).RBI has also taken steps in recent years to strengthen institutionalmechanisms such as recapitalisation of Regional Rural Banks (RRBs) andsetting up of local area banks(LABs).
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IMPOTANT SERVICES OF RRB
Micro-FinanceMicro-finance is a novel approach to "banking
with poor"as they attempt to combine lowertransaction costs and high degree ofrepayments.The major thrust of these micro-financeinitiatives is through the setting up of Self HelpGroups (SHGs),Non-Governmental
organizations(NGOs),Credit Unions etc.
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san armers re t ar
Another notable development in recent years is theintroduction of Kisan Credit Cards(KCC) in 1998-99.The purpose of the Kisan Credit Cards(KCC)
scheme is to facilities short term credit tofarmers.The scheme has gained popularity and itsimplementation has been taken up by 27commercial banks, 187 RRBs and 334 Centralcooperative banks.
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Agricultural Insurance
As Agricultural is highly susceptible to risks such asdrought, flood, pests etc.It is necessary to protect thefarmers from natural calamities and ensure their crediteligibility from the next season.
Towards this purpose, the Government of Indiaintroduced a comprehensive crop insurance schemethought the country in 1985 covering major cerealcrops, oilseeds and pulses. Among commercial crops,seven crops viz., sugarcane potato, cotton, ginger, onion,
turmeric and chilies are presently covered.
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BANKS: FUNCTIONING FOR THE
DEVELOPMENT OF RURAL AREAS
The rural banks of SBI are spread in 13 states extending fromKashmir to Karnataka and Himachal Pradesh to North East.
Haryana State Cooperative Apex Bank LimitedNABARDSindhanur Urban Souharda Co-operative Bank
United Bank of IndiaSyndicate BankCo-operative bankCO-OPERATIVE BANKS AND RURAL CREDIT by the BankingRegulations Act 1949 and Banking Laws (Co-operative Societies)Act, 1965.
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o-operat ve an s n n a nance
rural areas under:
Farming
Cattle
Milk
HatcheryPersonal finance
Institutional Arrangements for Rural Credit (Co-
operatives)
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DIFFERENT BANKS UNDER RRBCentral Co-operative Banks (CCBs)
The central co-operative banks are located at the districtheadquarters or some prominent town of the district. These bankshave a few private individuals also who provide both finance andmanagement. The central co-operative banks have three sources offunds,
Their own share capital and reservesDeposits from the public andLoans from the state co-operative banksTheir main function is to lend to primary credit society apart fromthat, central coopertive banks have been undertaking normal
commercial banking business also, such as attracting deposits fromthe general public and lending to the needy against propersecurities. There are now 367 central co-operative banks.
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State Co-operative Banks (SCBs)
The state Co-operative Banks, now 29 in number, theyfinance, co-ordinate and control the working of thecentral Co-operative Banks in each state. They serve asthe link between the Reserve bank and the generalmoney market on the one side and the central co-operative and primary societies on the other. Theyobtain their funds mainly from the general public byway of deposits, loans and advances from the Reserve
Bank and they are own share capital and reserves.
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COMMERCIAL BANKS AND RURAL
CREDIT
The commercial banks at present provide short term croploans account for nearly 45 to 47% of the total loans givenand disbursed by the commercial banks.
Term loans for varying periods are given for purchasing
pump sets, tractors and other agricultural machinery, forconstruction of wells and tube well, for development of fruitand garden crops, for leveling and development of land, forpurchase of ploughs, animals, etc. commercial banks alsoextend loans for allied activities viz., for dairying, poultry,piggery, bee keeping, fisheries and others. These loanscome to 15 to 16%.
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ommerc a an s an ma armers
The commercial banks identifying the small farmersthrough Small Farmers Development Agencies (SFDA)set up in various districts and group them into variouscategories for credit support so as to enable them tobecome bible cultivators. As regard small cultivatorsnear urban areas and irrigation facilities, commercialbanks can help them to go in for vegetable cultivationor combine it with small poultry farming and maintaing
of one or two milch cattle.
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REGIONAL RURAL BANKS AND RURAL
CREDIT
The Narasimham committee on rural credit recommended the establishmentof Regional Rural Banks (RRBs) on the ground that they would be muchbetter suited than the commercial banks or co-operative banks in meetingthe needs of rural areas. Accepting the recommendations of theNarasimham committee, the government passed the Regional Rural BanksAct, 1976.
The main objective of RRBs is to provide credit and other facilitiesparticularly to the small and marginal farmers, agricultural laborers,artisians and small entrepreneurs and develop agriculture, trade, commerce,industry and other productive activities in the rural areas.
The progress of RRBs in the initial stage was quite rapid. For instance, the
Sixth Five-year plan(1980-85) had envisaged the setting up of 170 RRBscovering 270 districts by the end of march 1985.The target was exceeded.There are now 196 RRBs in 23 states of the country with 14,200 branches.
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RRBs should really be strengthened and provided with more resources with which they canundertake more of these important activities. And most certainly they should be kept apartfrom a profit-oriented corporate motivation that would reduce their capacity to provide muchneeded financial services to the rural areas, including to agriculture. Ideally, the best use ofthe resources raised by RRBs through deposits would be through extensive cross-subsidisation.This, in turn, really requires an apex body that would cover and oversee all the RRBs,something like a National Rural Bank of India (NRBI).
RRBs' performance in respect of some important indicators was certainly better than that ofcommercial banks or even cooperatives. RRBs have also performed better in terms ofproviding loans to small and retail traders and petty non-farm rural activities. In recent years,they have taken a leading role in financing Self-Help Groups (SHGs) and other micro-creditinstitutions and linking such groups with the formal credit sector.
The number of rural branches should be increased rather than reduced; they should beencouraged to develop more sophisticated methods of credit delivery to meet the changingneeds of farming; and most of all, there should be greater coordination between districtplanning authorities, panchayati raj institutions and the banks operating in rural areas. Onlythen will the RRBs fulfill the promise that is so essential for rural development
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What is Bank
A Bank is financial institution whose primary activity
is to act as payment agent for customers, and to
borrow land.
Now banking is a service industry. In Indiathey are a major part of the financial sector
and serve as life blood for the whole industry
necessary to survive.
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Rural Banking
Today Indian Economy is considered as one
of the most rapidly expanded one among
the developing countries of the world.
Bank located in rural areas come up withdiverse
programmes to bring changes in the life ofrural
people by engaging them in selfemployment
schemes.
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Evaluation of Rural banking in India.
Co-operative credit institutions.
Commercial Banks.
Regional Rural Banks.
National Rural Banks.
Reserve Bank of India.
Nabard.
Kissan Credit Cards
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Banking Services & Rural Entrepreneurship
The Banking Sector have transformed the
farmers of yesterday to a top conscious
entrepreneur today and also contributing his
part in the development of national economy.
Besides the government schemes and
programmes the banking services came out
with their own programmes in promoting theinterest of rural entrepreneurship amongst these
people.