Internet use to ensure financial inclusion, transparency: Survey

The increased use of Internet in the financial services industry, which is seeing stiff competition, will help ensure more transparency and bring down distribution costs, says a Dun & Bradstreet report.

Usage of mobile technology in financial service will help the financial inclusion initiative and enhance delivery systems, said the D&B report on the BFSI sector.

"Primarily it (usage of Internet) would facilitate transparency in product pricing and characteristics; secondly it would be enable product segmentation to suit the distinct group of customers and lastly it will reduce the distribution costs," it said.

About 84 percent of the respondents in a D&B survey cited Internet as the most significant channel that would enhance the delivery systems.

"Adoption of technology and new delivery channels to enhance market reach, drive operational efficiencies and reduce cost would become priority of BFSI companies," the report said.

About 79 percent and over 73 percent of the respondents felt mobile wallets and mobile systems would provide a boost to the financial initiatives.

As per the Reserve Bank of India data, the number of transactions through mobile devices and services has increased from 1.08 million in April, 2011 to 7.16 million in November, 2013.

Despite this progress, usage of mobile for accessing financial services is yet to gain popularity in rural and semi-urban area, which indicates the scope for development of mobile technology to enhance the financial inclusion, the report said.

"The growth and transformation in the financial industry, in the future, would be decided by the steps taken to identify and adopt effective technologies, enhance market reach and their response to the changing economic factors," it added.