Welcome
Presentation on
SMART CARDGovernment of Andhra Pradesh
Objectives
To increase the outreach of main- stream banking and
financial services to the poorest of the poor by using
technology based solutions.
Ensure efficient and timely transfer of Govt. benefits to
the poor.
Minimize the possibility of fraudulent payments.
Total Financial Inclusion.
Approach
Create branchless banking infrastructure.
Open zero-frills accounts & issue Smart Cards to the poor.
Establish a banking out post in each village.
To begin with NREGS and SSP payments .
Banks will subsequently deliver banking services.
AP model- bank led
Banks lay the entire infrastructure through Service Providers and BC selected through competitive bidding.
Service providers provide technology.
– PoS equipment , biometric reader , Printer, cards, backend servers etc.
Business Correspondent delivers financial services to people through a village level CSPs
All CSPs are women and members of SHGs
Stationary Payment system in every GP
Govt pays 2% commission on payments handled.
Technology Aspects
• Back end network– central servers of service providers integrated to bank servers
• Front end– Finger print scanner and reader– Hand held equipment provided with a printer which handles
enrolments and payments– Mobile phone with camera
(OR)– PoS terminal which integrates all the above functions.
• Mx Smart Card– 32 KB and with java Card application called “data store”.
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A.P. SMART CARD PROJECT
Technology (M/s Fino)
11001000…
Image
TemplateCode
Slot to insert Operator / Customer card
Slot to insert Operator / Customer card
F buttonF button
Receipt Generation Slot
Receipt Generation Slot
Slot to capture thumb print
Slot to capture thumb print
Arrow Key for starting the device
Arrow Key for starting the device
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A.P. SMART CARD PROJECT
Technology (M/s Little World )
• Based on new generation Near Field Communications (NFC) mobile phones; contact-less RFID smart cards and integrated biometrics.
• Alternate option of attaching fingerprint scanner + card reader to a PC or PoS.
Can also be deployed on PCs - by adding a NFC card reader + fingerprint scanner (both USB peripherals costing about Rs. 6000)
Awareness
Orientation to APDs, MPDOs,APOs & TAs by
PD,DWMA
Orientation to IKP staff
by PD, DRDA
Orientation to FAs at
Mandal level
Orientation to VOs at
Mandal level
Awareness prog for the non-
officialsat Mandal level
Awareness prog for the non-
officialsat Mandal level
Key- processes
1. Enrolment
– RD gives beneficiaries data of SSP & NREGS database
– Concerned bank conducts enrolment camp in the village
through SP.
– GPs, VOs assist the organisation in mobilization and
identification of beneficiaries.
– 6/ 10 finger prints, photo and nominee details of the
beneficiary captured.
– Data will be forwarded to back office for processing
Contd..
Enrollment- work flow
Key- processes
2. Preparation and issue Smart Card.
– Data collected during enrolment is encrypted on
the card including biometric. (Encrypted Java smart
card with 32 KB memory).
– Account is opened
– Card is delivered to the beneficiary in the village
within three weeks.
Issue of Cards- work flow
Key- processes
3. Business Correspondent(BC) & Customer Service
Provider (CSP)
– BC of the bank appoints CSP at village level.
– Training to CSP is given by bank and BC.
– Required hardware like Finger print reader, printer,
mobile phone etc., are positioned in the village.
Key- processes
4. Payment
– Govt. issues instructions to the banks authorizing
payment.
• List of beneficiaries and authorized amount will
be handed over to bank
– Bank credits the Individual account of beneficiary
– Cash is physically transported by the BC on behalf
of bank and delivered at the door steps of CSP.
Key- processes
5. Disbursement– CSP sits at a pre-designated government premises
usually GP building etc. – Beneficiary approaches with card.– Card is inserted in the card reader and identity of
beneficiary is established through biomatric authentication.
– a/c balance of the beneficiary is displayed on the screen & cash is paid.
– A receipt is generated in duplicate.– A manual acquittance also maintained.– In case of exigencies, manual payment is made.
Key-processes
6. Data uploading
– CSP uploads data of disbursements daily, bank
data base is updated.
– MIS report on progress of disbursement is
submitted to Government by bank.
Smart card – interface work flow
Beneficiary A/cs updated
B.C. Delivers cash to CSP
CSP pays & uploads data
S.P. & Bank servers updated
Musters entry
A/c No. data
Govt.
A/c Data is updated in MCC
e-payorder & Check
MIS to Govt.
Enrolment in Village
A/c opened and cards personalized
Bank & S.P.
Pilot districts - Warangal
(6) Mandals in Warangal district.
– Dharmasagar S.B.I
– Geesukonda Andhra Bank
– Station Ghanpur A.P.G.V.B
– Raghunathpally Axis Bank
– Hanumakonda Union Bank of India
– Raiparthy S.B.H.
Started in 5 villages on April 30th 2006 with pension payment. Pension payment under taken in all 6 mandals 7/06 Service provider- ALW & Zero Mass, for all banks
Pilot district - Karimnagar.
(2) mandals in Karimnagar district with -FINO
– Thimmapur
– Sirsilla
Started in 5 GPs on 1/7/06 with pension payment.
Wages under NREGS paid in the entire Thimmapuram mandal
on 13th Aug. 2007.
After the pilot, the bank model was adopted.
Pilot - progress
No. of GPs covered : 199
No. of benfs, enrolled : 1.37 Lakhs
No. of cards issued : 1.12 Lakhs
Amount paid : Rs. 53.34Cr
Pilot continued for 1 year for stabilization
Upscaling ( service area model) Phase -I
Upscaled to 6 districts in Aug. 2007.
Service area approach adopted.
20 banks out of 27 agreed to implement, but only 10
banks started work.
Service Area Model
S.No. Bank District No. of Districts
1 State Bank of India
Warangal, Karimnagar,
Medak, Mahabubnagar,
Chittoor, East Godavari
6
2 Union Bank of India
3 Corporation Bank
4 Axis Bank
5 Deccan Gameen Bank
6 A.P.G.V.B.
7 ING Vysya Bank
8 Andhra Bank
9 Punjab National Bank
10State Bank of
Hyderabad
Progress at a glance - Phase-I
Villages where enrolment started : 3636
Beneficiaries enrolled : 23.19 Lakhs
Beneficiaries issued cards : 20.79 Lakhs
Amount disbursed to the beneficiaries :Rs.273.17
Crs.
Limitations in service area approach
Project is being implemented in isolated pockets
because a bank branch has few villages in its SA.
Service areas of a bank are small and widely dispersed.
MPDO had to deal with several banks.
Operations became cumbersome.
This model could not saturate sizable area and failed to
enthuse the stakeholders.
Upscaling (One bank – one dist. Model) – Phase -II
Govt. of AP explored new models.
Based on such recommendations of a technical
committee recommendations, RBI approved “One
Bank – One District model”
Banks started showing considerable interest in this
model.
One Bank – One District Model
S.No. Bank DistrictNo. of
Districts
1 State Bank of IndiaVizianagaram, Kadapa &
Nalgonda3
2 Union Bank of IndiaVisakhapatnam, West Godavari & Prakasam
3
3 Andhra Bank Srikakulam & Guntur 2
4 Axis Bank Krishna & Ranga Reddy 2
5 Syndicate Bank Ananthapur & Kurnool 2
6 A.P.G.V.B. Khammam 1
7 State Bank of Hyderabad Nellore 1
Total 14
Progress at a glance - phase-II
Villages where enrolment started : 6902
Beneficiaries enrolled : 32.07 Lakhs
Beneficiaries issued cards : 21.67 Lakhs
Amount disbursed to the beneficiaries :Rs.193.55
Crs.
Overall progress at a glance
No. of GPs where project is under way. : 10,737
No. of benfs, enrolled : 56.65 lakhs
No. of cards issued : 42.46 Lakhs
Amount paid : Rs. 466.73Crs
Emerging models
1. One bank – one mandal – pilot – in 8 mandals (Aug-06)
• 6 banks participated• 199 Panchayats covered• 1.12 lakhs cards issued• Rs.53.34 Crs amount disbursed to the beneficiaries
2. Service Area approach – in 6 districts (Aug-07)
• 10 Banks are participating• 3,636 G.Ps work started• 20.79 lakh cards issued• Rs 273.17 Crs. amount disbursed to the beneficiaries
3. One bank – One district model – in 14 districts (Sep-08)
• 7 banks are participating• In 14 districts work has started• 21.67 lakh cards issued• Rs 193.55 Crs amount disbursed to the beneficiaries
Important developments
RBI announced an incentive policy of Rs.50/- for each account opened ( effective from 01.07.2008 )
• 6 banks accessed Rs 1.81cr sofar
GOI established Financial Inclusion Fund (FIF) and Financial Inclusion Technology fund (FITF) with 500 crores.
• APGVB is the first bank to access Rs.20.00 crores from FIF.
RBI set up a state level steering committee with CS as
chairman
Critical learning from the project
1. Detailed implementation arrangements: At state level, district & Sub-district level
Should involve Govt., Banks & Service providers
Involvement of Regional Office of RBI
A dedicated team at every level is critical
*Bank & Service Provider position a point person at district level
2. Enrolment: Better to start block by block, saturate and move on
Arrangements for prior intimation identification of beneficiaries
After completion of main phase. Separate arrangements for handling left over enrolments.
For Coordination
Critical learning from the project
3. Issue of Cards: Delay in opening accounts
Delay in activation of cards
Delay in handing over cards to beneficiaries
*Activated cards ready for operation should be delivered in 2-3 weeks after enrolment
4. CSPs : Identification, Training and Positioning - delays
Regular over sight
Periodical training, inspection
*Possible problems of politicization
Contd..
Critical learning from the project
5. Payments:
On-line MIS and 100% biometric based electronic payments are very critical
Advisable to keep a pass book with beneficiary
6. Change management:
Orientation to Govt. Officials, Banks staff and Public representatives
– On concept and procedure
– Helps raising awareness, removing apprehension and problem solving
– Training Branch managers and Bank Staff is critical
Contd..
Critical learning from the project
7. Long – Term issues
De- duplication of data
Laying uniform technology standards
Inter –operability across varies service providers
Delivering Banking services
Contd..
Enrolment Kit
Enrolment – photo graph
Enrolment – Capturing finger prints
Disbursement of Cards
Disbursement of Cards
Handing over cash to CSP
CSPs about to make payment
Payment –finger print checking
Payment –finger print checking
Payment –finger print checking
Payment –Receipt printing