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product is for its brand, the low premium and most importantly the assured lump sum at
the end of the period. 30% members having bank accounts is no surprise as most
members would have the same due to government transfers. The fact that members are
seeking other avenues to part their money like post offices, recurring deposits etc all
indicate a need for “low frequency” savings products.
Key Findings
Distance to bank, lack of time, inflexible products and lack of awareness
of products were the main constraints faced by members to open
accounts outside the SHG.
The BC (Business Correspondent) present in some villages however
makes them comfortable to reach out to other financial products.
There is no significant difference in income between Tamil Nadu and
Karnataka. However there is difference in all heads of expenditure in
both the states. This may reason for the presence of greater saving in
Tamil Nadu what we term as “low frequency savings”.
We find that there are many members have availed the LIC policy,
recurring deposit and fixed deposits. Various savings flexible products
can be introduced through the Business Correspondent, as NGOs cannot
introduce savings by the Indian regulation.
Insurance is another product which is easily taken by members if they
realize its importance. It is important to introduce both term insurance
and medical insurance
