To boost their businesses, financial service providers need to tap innovative technologies, such as social, mobile, analytics and cloud, to reach out to millions of Indians, especially those residing in 2,500 towns which were earlier classified as large villages, a CII-PwC report released on Thursday said.
Disposable income of large villages which have transformed into towns will increase to Rs 78,000 in 2016 from Rs 40,000 in 2010, estimates the CII-PwC study. Between 2001 and 2011, India added 2,500 towns, earlier classified as large villages.
This is likely to result in higher consumption of good and services as well as the need for financial products to enhance savings and investments. The increased consumption of lifestyle products and the ability to ape an ‘urban’ lifestyle has led to shifting demand patterns. A variety of goods, such as smart phones, automobiles and other electronic gadgets, are now common in rural India.
However, given the cost of tapping the rural areas, financial providers do not seem to identify any viable opportunities in these markets, the report said.
C. Jayaram, Chairman-CII Financial Distribution Summit 2013, and Joint Managing Director, Kotak Mahindra Bank, said, “Presently, 47 crore people in India belong to the ‘emerging middle income’ group, earning $1 to $5 a day, and about 40 per cent of the households are financially excluded. This market is expected to cross $1 trillion by 2021. Market players need to capitalise on the benefits that technology has to offer.”