Instead of sending people to a bank, Sub-K brings banking to the people

Sub-K’s banking correspondent and agent banking network advance financial inclusion in India

By Abhishek Agrawal and Adelina Dasso

Sub-K is helping to close the financial services gap in India

Banking is expensive. That’s one of the reasons why billions of people around the world still don’t have access to even the most basic financial services. Sub-K, which means “for everyone” in Hindi, is working to close the gap in India, and we’re excited to partner with them in this effort.

Closing the financial services gap with business correspondents

Operating a bank branch is exponentially more expensive than employing an agent to offer payment services outside of a bank. But there’s more to financial inclusion than the ability to make payments. People need a full range of tools to support their families and businesses.

It’s not surprising that India, a country characterized by its openness to innovation and its focus on reaching underbanked and unbanked populations, has come up with many solutions. The Reserve Bank of India created business correspondents to offer accessible and affordable delivery channels for customers. These correspondents operate in partnership with financial service providers (banks and non-banking financial institutions), and they offer a broader range of products than just payment services — including money transfers, government subsidy payments, bill payment, international remittances, e-commerce, distribution of microinsurance, and even loan origination and servicing for financial service providers.

How Sub-K is addressing financial inclusion with innovation and partnerships

Sub-K is a unique banking correspondent focused on people who cannot be reached by traditional financial service providers. Sub-K operates throughout India in 23 states with more than 100 cobranded branches and 13,000 agents — typically “mom and pop” shops or “kirana” stores. The company offers a broad range of financial services, including payments, saving accounts, and lending. So far, they’ve partnered with 14 banks to serve about 2 million clients and distribute more than US$100 million in loans.

As India shifts from cash to digital, Sub-K is well-positioned to reach new customers and help them access financial tools. Sub-K brings to the table an in-depth understanding of clients and a focus on innovation. Sub-K has been able to integrate various electronic wallets with Aadhaar, India’s unique identity card for all adults. It has also leveraged other elements of IndiaStack, the government’s digital infrastructure that’s revolutionizing financial services.

Sub-K is part of the BASIX Group, which has a long history on financial inclusion in India with partners such as RBL Bank, Syndicate Bank, Bank of Baroda, United Bank of India, Reliance Capital, and other financial institutions committed to reaching the unbanked. This focus on financial inclusion extends to Sub-K’s management and our co-investors (Nordic Microfinance Initiative and the Michael and Susan Dell Foundation). Our alignment on this crucial cause was vital for our partnership. In addition to investing funds in Sub-K, we’re also providing advisory services to enable Sub-K to continue expanding to more clients throughout India and focus on improving its technology, optimizing its use of data analytics tools, and launching innovative financial products.

Sub-K’s understanding of client needs and digital infrastructure along with its network of agents and bank partnerships make for a potent combination. We’re eager for this opportunity to help provide families in India with the financial services they need to build better lives.

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