Question

Q. In the context of India's banking sector, which of the following entities are eligible to work as the “Banking correspondent”?

Select the correct answer using the codes given below

• A.
  1, 2 and 3 only
• B.
  2 and 4 only
• C.
  1, 3 and 4 only
• D.
  1, 2, 3 and 4

Answer 1

The correct option is D

1, 2, 3 and 4
Explanation:

In order to increase the banking outreach and ensure greater financial inclusion in the economy, the Reserve Bank of India took the Banking correspondent initiative in 2006. Business Correspondents work as the retail agents engaged by banks for providing banking services at locations other than a bank branch/ATM.

The entities permitted to act as Banking Correspondents are NGOs/ MFIs set up under Societies/ Trust Acts, Societies registered under Mutually Aided Cooperative Societies Acts or the Cooperative Societies Acts of States, Section 25 companies, post offices, retired bank employees, retired teachers, retired government employees and ex-servicemen, individual owners of Kirana / medical /Fair Price shops, individual Public Call Office (PCO) operators, Agents of Small Savings schemes of Government of India/Insurance Companies, individuals who own Petrol Pumps, authorized functionaries of well-run Self Help Groups (SHGs) which are linked to banks, individuals operating Common Service Centres (CSCs), etc.