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INTERIM REPORT

Apeejay Stya University


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2013-14







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Interim Report
on
Banking: Central Mission Mode Project
Delivering Services

@




Apeejay Stya University
Sohna, Gurgaon
Haryana



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Preface

The Government of India is keen to understand the nature and quantum of impact created
by e-Governance projects that have been implemented by state and national agencies
under the National e-Governance Plan (NeGP). The Department of Information
Technology (DIT), Government of India as the nodal coordinating agency for the NeGP
is directed to carry out an impact assessment study of state/ national level projects that
have been implemented or under process in India. The assessment is to focus on the
nature and quantum of impact on citizen and organization of India.

Impact Assessment of the Banking project in Public Sector Banks is taken up in the
current cycle of assessment studies on citizen and service providing agencies of India by
considering key dimensions of impact like economic (direct/indirect), governance in term
of (corruption, accountability, transparency, participation), Quality of service,
performance on key non-economic objectives, process improvements, quality of
implementation. The Engineering Watch agency was assigned the task of assessing the
impact of the respective project (Banking-MMP) and preparing an individual report for
this project.

The Apeejay Stya University (ASU), served as one of the assessment body based on
technical and non-technical parameters for the proposed project Banking. A team from
ASU worked closely with selected Public Sector Banks for the assessment study and
provided feedback to the Engineering Watch at key points of assessment. The field
survey of selected five Public Sector Banks (Punjab National Bank, Oriental Bank of
Commerce, Syndicate Bank, Bank of India and Central Bank of India) was further


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assessed through services available on respective web portals of the banks and compared
with the survey performed.




Abbreviations and Acronyms
ATM Automated Teller Machine
ASU Apeejay Stya University
ASBA Application Supported by Blocked Amount
BOI Bank of India
CERSAI Central Registry of Securitization Asset Reconstruction and
Security Interest of India
CRM Customer Relationship Management
DIT Department of Information Technology
DC Data Center
DRS Disaster Recovery Site
ECR Electronic Central Registry
IA Impact Assessment
ICT Information and Communications Technology
MSME Micro, Small and Medium Enterprises
MMP Mission Mode Projects
NeGP National e-Governance Plan
NEFT National Electronic Funds Transfer System
OBC Oriental Bank of Commerce
PSB Public Sector Banks
PPP Public- Private Partnership
PNB Punjab National Bank
PMEGP Prime Minister's Employment Generation Programme
R&D Research & Development


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RRBs Regional Rural Banks
RBI Reserve Bank of India
SARFAESI Securitization and Reconstruction of Financial Assets and
Enforcement of Security Interest
SCBs Scheduled Commercial Banks
SME Small & Medium Enterprises
VSV Verified by Visa


Executive Summary

Assessment of Delivery of Key Services: the Citizens and organizational Perspective

The report presents an overall view of the impact of varying degrees of computerization
in the service delivery of banking departments in selected five Public Sector Banks
Punjab National Bank, Oriental Bank of Commerce, Syndicate Bank, Bank of India and
Central Bank of India as part of Mission Mode Projects (MMP) Banking. The Banking
Mission Mode Project under NeGP covers the following services like electronic central
registry under Sarfaesi Act, 2002, one India one account-for Public Sector Banks (PSB)
and electronic mass payment system. This report is based on framework for Impact
Assessment (IA) and baseline study report at the national level. Therefore, the
information and analysis presented in this report is limited by the content of the national
level reports framework for citizens like direct and indirect impact of economy,
governance in term of corruption, accountability, transparency and participation of
citizens, Quality of services in term of decency, fairness and convenience etc. Few
parameters for impact assessments study used here are as follow:

No. of accounts in same bank and in different bank( duplicity in records)
Ratio of users who are using computerized and non-computerized services


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Awareness about central registry act.
Cost of availing service measured directly & indirectly
Number of trips made for the service
Average waiting time in each trip
Total time elapsed in availing service
Amount paid as bribe to functionaries
Amount paid to agents to facilitate service if any
Preference for manual versus computerized systems
Quality of Service: Interaction with staff, complaint handling, privacy, accuracy
measured
Satisfaction with the location of the service delivery center/office
Convenience of working hours of the service delivery center/office
Overall attitude of the functionaries in terms of courteousness and friendliness
Timeliness of response to queries by clients
Satisfaction with the mechanism for complaint handling and problem resolution
Perception about the confidentiality and security of data
Satisfaction with the overall quality of service
Quality of Governance: Transparency, participation, accountability, corruption
measured
Level of corruption in the current working system
Awareness about the citizen charter
Adherence of the time frame for service delivery (elapsed time)
Financial loss due to delay in availing the service
Extent to which government officials can be held accountable for their actions
Whether the rules and procedures are simple and stated clearly
Perception about the overall quality of governance
Other e-Governance scheme run by individual bank
Unique customer identification maintained by bank


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Mode of electronic mass payment system adopted by banks etc.

Analysis of qualitative feedback from users and bank employees, suggests several areas
of improvements in the current applications such as faster servers, improved design of
online interface, more counters to minimize queues, and better trained staff. Lack of
information regarding various beneficial schemes run by government is also a major
problem. One way in which it can be minimized is to offer end-to-end online services and
awareness of multiple schemes run by government for citizen welfare.





Table of Contents

Preface..2
Abbreviations and Acronyms..3
Executive Summary ............................................................................................................4
1.1 Introduction....................................................................................................................7
1.2 Brief Description of the Projects ...................................................................................8
1.2.1 Central Electronic Registry under the Securitization and Reconstruction of
Financial Assets and Enforcement of Security Interest (Sarfaesi) Act
2002.10
1.2.1.1 Sarfaesi Act 2002 important features.11
1.2.1.2 Limitations with the central registry data base..12
1.2.1.3 Assessment of the electronic central registry12
1.2.2 One India One Account.......................................................................................13
1.2.2.1 Advantage of one India one account.15
1.2.2.2 Assessment of one India one account15


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1.2.3 Electronic Mass Payment System........................................................................17
1.2.3.1 Main basic features of electronic mass payment system...19
1.2.3.2 Assessment of the electronic mass payment system.20
1.3 Research Methodology and Sampling........................................................................24
1.3.1 Design data collection form ...........................................................27
1.3.2 Sampling Plan, Sample Size and Profile ...........................................................27
1.4 Data analysis and comparison of services...............................................................29
1.4.1 Value Delivered by the Online Applications......................................................29
1.4.2 Comparison of the project across Key Dimensions ..............................31
1.4.3 Overall Assessment ..33
1.5 Analysis of Qualitative Feedback and Suggestions ...................................................35
1.6 Conclusion .................................................................................................................36



1.1 Introduction

Seventh national e-Governance plan has been formulated by the Department of
Information Technology and Department of Administrative Reforms and Public
Grievances. The National e-Governance plan aims at improving delivery of Govt.
services to citizens and businesses with a view to make all govt. services accessible to a
common man in his locality through common man delivery outlets and ensure efficiency
transparency and reliability of such services at affordable cost to realize the basic needs
of the common man. The implementation strategy, approach and methodology adopted
for national e-governance plan contemplated the following elements
Common Support Infrastructure: National e-governance plan implementation
involves setting up of common and support IT infrastructure.


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Governance: Suitable arrangements for monitoring and coordinating the
implementation of National e-governance plan under the direction of the
competent authorities have also been substantially put in place. The programme
also involves evolving / laying down standards and policy guidelines, providing
technical support, undertaking capacity building, R&D, etc.
Centralized Initiative, Decentralized Implementation: e-Governance is being
promoted through a centralized initiative to the extent necessary to ensure citizen-
centric orientation, to realize the objective of inter-operability of various e-
Governance applications and to ensure optimal utilization of ICT infrastructure
and resources while allowing for a decentralized implementation model.
Public-Private Partnerships (PPP) model is to be adopted wherever feasible to
enlarge the resource pool without compromising on the security aspects.
Integrative Elements: Adoption of unique identification codes for citizens,
businesses and property is to be promoted to facilitate integration and avoid
ambiguity.
Programmed Approach at the National and State levels: For implementation
of the National e-governance plan various Union Ministries/Departments and
State Governments are involved. Considering the multiplicity of agencies
involved and the need for overall aggregation and integration at the national level.
Facilitator role of DIT: DIT is the facilitator and catalyst for the implementation
of National e-Governance plan by various Ministries and State Governments and
also provides technical assistance.
Different Mission Mode Projects conceptualized under National e-Governance plan
initially are as under:-
Central Government Category : Nine Mission Mode Projects
State Government Category : Eleven Mission Mode Projects
Integrated Service Category : Seven Mission Mode Projects


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To sustain the above projects there is also need to create the right governance and
institutional mechanisms, set up core infrastructure, formulate key policies, standards and
resources. One of the Mission Mode Projects relates to banking. The Banking Mission
Mode Project under NeGP covers the following services:
1. Electronic Central Registry under Sarfaesi Act, 2002
2. One India One Account-for Public Sector Banks
3. Electronic Mass Payment System
In view of the proposed roll out of the ambitious National e-Governance Plan (NeGP),
the Government of India was keen to understand the nature and quantum of impact of
existing e-Government projects implemented by national agencies. For this purpose, the
Apeejay Stya University as the nodal agency decided to undertake an impact assessment
study of the Banking project.
1.2 Brief Description of the Project
The MMP is being implemented by the banking industry which aims at streamlining
various e-services initiatives undertakers by individual banks, e-governance
implementation is done by the banks concerned with the banking Department providing
a broad framework and guidance to them. Out of three components of the MMP, the
component of Electronic of Mass Payment System may not take up for implementation
because banks are independently taking up their own initiative on this front. The other
two components i.e. Electronic Central Registry and One India one account for Public
Sector banks have been referred to Indian Bank Association. With focus on inclusive
growth, the Indian government has been encouraging opening of bank accounts for the
nations huge un-banked population by providing government benefits through such
accounts. ICT solutions have made such initiatives possible at relatively low cost. While
the growth that India has seen during the past decade has been impressive, there are some
concerns about the dimensions related to financial services. Lot of work needs to be


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done before the concerns of absolute poverty can be addressed. The low income
households in India have very little awareness of banking, credit and insurance related
services through which they can enhance and protect their financial resources during
times when they are unexpectedly struck by illness, natural disasters or death of the
primary breadwinner.
The optimism about Indian economic growth portends well for Indian banks. There are,
however, challenges in retaining profitability and growth in the next decade. The industry
has to live up to high expectations from several quarters. There are ten major trends that
will shape Indian banking over next decade. It identifies two critical and complex
challenges thrown at the industry for which solution has to be found with urgency. The
report outlines potential solutions and articulates key imperatives for government and
regulation. The ten major trends to watch out for are retail banking will be immensely
benefited from the Indian demographic dividend, mortgages to grow fast, rapid
accumulation of wealth in rich households will drive wealth management to 10X size,
The Next Billion consumer segment will emerge as the largest in numbers and will
accentuate the demand for low cost banking solutions, branches and ATMs will need to
grow 2X and 5X respectively to serve the huge addition to bankable population, low cost
branch network with smaller sized branches will be adopted, mobile banking will come
of age with widespread access to internet on mobile, banks will adopt CRM and data
warehousing in a major way to reduce customer acquisition costs and improve risk
management, margins will see downward pressure both on retail and corporate banking
spurring banks to generate more fees and improve operating efficiency, banks will
discover the importance of the SME segment for profitability and growth and new
models to serve SME segment profitably will be found, investment banking will grow
10X, driven by demand from corporate for transaction support and capital market access,
it will touch the ALM limits of banks and will require a significant upgrade of banks risk
management systems etc. After consideration and implementation of above proposed
trends and three main parameters for allotted mission mode project leads to transparency,


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efficiency, sustainability and scalability in whole banking process. Detail of three main
parameter is given below and summery of all described in table 1.
1.2.1 Central Electronic Registry under the Securitization and
Reconstruction of Financial Assets and Enforcement of Security
Interest (Sarfaesi) Act 2002
The objective of setting up of Central Registry is to prevent frauds in loan cases
involving multiple lending from different banks on the same immovable property. This
Registry has become operational on March 31, 2011. The Central Registry of
Securitization Asset Reconstruction and Security Interest of India (CERSAI), a
Government Company registered under section 25 of the Companies Act 1956, has been
incorporated for the purpose of operating and maintaining the Central Registry under the
provisions of Securitization and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 (SARFAESI Act) .

The Central Registry has been established in Indian Banks Association, Delhi Local
Chapter C/o Punjab National Bank, Rajendra Bhavan,Rajendra Place, New Delhi 110008
vide notification issued by Govt. of India Ministry of Finance Department of Financial
Services in March,2011 Actually, the Central Registry Rules and establishment of
Central Electronics Registry has been made pursuant to the recommendation made by
working group set up by the Indian Banks association in J an,2009. The Central Registry
Rules mandates the compulsory Registration of all particulars pertaining to every
transaction of securitization or reconstruction of financial assets and satisfaction of such
transaction on realization of financial asset or creative modification or satisfaction of any
security interest within a period of 30 days.
The availability of Electronics records maintained by the Central Registry is expected to
prevent, minimize and mitigate unfortunate instances of fraud wherein banks and
financial institutions tend to extend / sanction financial assistance against provisioning


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of security of same property as well as fraudulent sale of the same without disclosing the
security interest over such property by unscrupulous borrowers since the same can be
searched by any lender or other person desirous of dealing with the same properties. To
give the much needed teeth to these provisions and implement the same, a Government
company ( The Central Registry of Securitization Interest of India CERSAI) has been
incorporated under section 25 of the company Act 1956, for the purpose of operating and
maintaining the Central Registry has been setup with an authorized capital of Rs 100
crores and authorized paid up capital of Rs 49 crores with Governments contribution
of 51% and rest 49% by 11 share holding banks like National Housing Bank , State Bank
of India, Punjab National Bank, Bank of Baroda etc.
1.2.1.1 Sarfaesi Act 2002 important feature
(a) Users registration: Users Registration is compulsory with Central Registry .
(b) IT Architecture: The IT infrastructure for Central Registry has since been
commissioned with Data Centre (DC) at Noida and Disaster Recovery Site (DRS)
at Chennai. These centers are manned on 24X7 basis by the IT vendor of the
company.
(c) Institutions: All Commercial Banks, Private Banks, Foreign Banks, Co-Operative
Banks, RRBs, Selected HFCs (22), Financial institutions and Asset
Reconstruction Companies are the institutions which are expected to make use of
Central Registry efforts.
(d) Public Search: Online search will be on the uploaded Security Interest records
available in the Central Registrys database. This facility will be helpful to
general public to check the encumbrance status on a given property and common
knowledge of the encumbrance status by all lending institutions will help in
preventing frauds. This facility was scheduled to start functioning from 3rd
week of J anuary 2013.
1.2.1.2 Limitations with the Central Registry data base


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Central Registry addresses the encumbrance status of a property; there is no
mechanism available in the Central Registry system to check the ownership of a
property.
Non-availability of information like ownership etc. at the time of creation of
security interest does not guarantee whether the borrower is the actual owner of
the property.
Since land assets are being a state subject governed by respective laws of the state(s),
it is essential to have a synergy between the Central Registry system and State
Registries.
In the absence of information on the genuine title, only encumbrance certificate
will not be sufficient to prevent fraud.
Availability of information on Bank guarantee on a Central Portal for online search
need to be explored. Establishment of State Registries in conformity with the time
schedule set for operation of Central Registry appears to be doubtful. This needs to
be ensured by instituting necessary measures for proper integrated approach at
national level.
Manpower & Technical support: Adequate technical man power, hardware,
software and integration to be established to meet the requirement of user across
the country.
1.2.1.3 Assessment of the Electronic Central Registry
Impact: Creation of Electronic Central Registry(ECR) under SARFAESI Act
2002 with an objective to prevent frauds in loan cases / financial assistance by
Banks / Financial Institutions across the country against various assets (
immovable properties ) mortgage has positive impact on the overall working and
decision making process from institutional angle and financial / administrative
approach by the concerned authorities.


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Utility: The concept of ECR is expected to introduce a new working environment
at national level in the process of extending loans / financial assistance by Banks /
Financial institutions against immovable properties with an ultimate aim of
preventing frauds. The environment so generated will have far reaching
advantage / utility in handling loan cases by the authorities concerned.
Sustainability: The Electronic Central Registry concept has been designed to
have an integrated system at national level to prevent frauds in loan cases against
immovable properties. The entire maintenance and operational arrangements
envisaged for the scheme needs to be placed in position to ensure sustainability
of the scheme as a whole in the form of independent procedures oriented backed
by technical and administrative support in the years to come.
Scalability: Scalability of any procedure, system and organization can be ensured
by means of inducing compatible technical, administrative and manpower support
progressively over a period of time in the process of increasing and expanding
basic needs with the passage of time. Proper maintenance backing, reviewing and
monitoring mechanism is an inescapable requirement to ensure healthy scalability
of the overall system.
Replicability: The ECR system placed in position at national and state levels may
require replicability in future at more destinations identified with the passage of
time with regard to basic application needs of the system.
1.2.2 One India One Account:
One India one account for public sector banks is essential to ensure healthy financial
management in the country especially in banking sector. It also ensure that all the
payment and settlement systems operating in the country are safe, secure, sound,
efficient, accessible and authorized and contained both short and medium term plans
along with a slightly longer term perspective to achieve those goals. In India, there
are total of 21 Public Sector Banks, 80 regional rural banks, 19 private sector banks


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and 32 foreign operating banks. Where Public Sector Banks (PSBs) are banks where a
majority stake (i.e. more than 50%) is held by a government. The shares of these
banks are listed on stock exchanges.
The Indian government has been encouraging opening of bank accounts for the
nations huge un-banked population by providing government benefits through such
accounts. ICT solutions have made such initiatives possible at relatively low cost. The
banking sector has taken a lead role in promoting financial inclusion. There has been
in multi-fold increase in the number of bank branches, especially in rural areas; the
branch network was around 8,000 in 1969 and now it is more than 89,000, spread
across the length and breadth of the country. However, these initiatives for
strengthening financial inclusion are yet to have a substantial impact on the lives of
the excluded population. Over half the Indian population is un-banked. Only about 55
percent of the population in the country has deposit account and around 9 percent
have credit accounts with banks. According to data from Reserve Bank of India
(RBI), India is the home to largest number of un-banked families (more than 145
million). There is only one bank branch per 14,000 people. The total number of
villages in the country is estimated to be around 6 lakhs, but the number of scheduled
commercial banks (SCBs) and Regional Rural Banks (RRBs) stand at only 33,495.
A recent directive from Reserve Bank of India has acknowledged the need of
stepping up opening of branches in rural areas so as to improve banking penetration
and financial inclusion. Banks have been advised as part of risk management to adopt
ICT solutions. The overall strategy of the government of India for having an inclusion
financial sector in the country is primarily based on the following aspects:
Centralized banking.
One account for all.
Maximum coverage of un-banked population (the most important thing is
to ensure that financial services should reach each and every person in country)
Effecting improvements within the existing formal credit delivery mechanism


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Suggesting measures for improving credit absorption capacity especially amongst
marginal and sub marginal farmers and poor non-cultivator households;
Evolving new models for effective outreach, and
Leveraging on technology based solutions i.e. mobile banking, internet banking
etc.
These can be achieved through efforts of public sector banking i.e.
By increasing total number of bank branches and ATMs in country.
Wealth management will be big business with exponential growth in upcoming
time.
Mobile banking to see huge growth and will redefine transaction banking
paradigm
Customer relationship management(CRM) and data warehousing will drive the
next wave of technology in banks
Banking margins will come under pressure.
New models to serve the small and medium enterprises(SME)
Investment banking will grow over ten fold
Pricing of transaction in the banks will get reduced substantially.
1.2.2.1 Advantage of one India one account
If we achieve one India one account practically, our banking processes and procedure
become more
Efficient
Transparent
Quickly accessible
Developed integrated system
Standardized, and portability in banking operations will be achieved
Interoperable
Developed in terms of infrastructure and integrated payment system


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Efficient and effective enhancement in the sales and purchase systems
1.2.2.2 Assessment of the One India One Account
Impact

Efficient and Quick Mode of operation: The analogy of mobile number portability
applies to the One India One Account. So the similar impact that mobile industry
have made to the peoples life can be adjudged on the life of banked people, for
example if you decide to change your bank because of factors like nearness to
home, level of comfort etc, your account number will be carried forward and will
remain same. So less hassle for managing closure of one account, opening of
another account, infect same documents used for opening old account can be
carried forward from the bank to bank (electronic version), so even lesser job on
the part of bank customers.
Transparency in Transaction: With the multiple accounts it is hard to collect
transaction details of a particular bank customer, so with the presence of this
facility it will be easy for the banks as well as for the customers to keep track of
the transactions.
Fraud Detection will be easier.
Utility
Facility can be used for quickly gathering transaction data to calculate tax
information with much greater ease then in the case of One India Multiple
accounts.
Customers can use this facility to manage their transactions easily (i.e,
querying one central account number will be sufficient to get the list of entire
transactions). This will also aid in quick management from the point of view
of resource requirement.


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Fast Processing and easy operation thereby increasing the comfort zone of the
customers and bank people.
Sustainability
Sustainability is directly proportional to the customer satisfaction, with the quick
and simple facility provided by the bank, customers confidence and trust in the
system is automatically enhanced which leads to the greater scope of
sustainability.
one India one account as a centralized banking acts as an integrated system leads
to transparency and thereby sustainability is ensured.
Good maintenance and operational arrangement ensures sustainability
Scalability
As far as the scalability of this feature is concerned, the system should be able to
accommodate as many users as possible along with the up gradation of the
existing system and anything new in the system, with the conversion of unbanked
people to the banked community the system should work without fail and even
without affecting the existing users of the existing systems.
Replicability
As the theme of mobile portability is being replicated in One India One Account
the same theme can be replicated for providing services to Indian Citizens where
unique ID is mandatory. So this One Account can act as a Unique ID for the
citizens.
State and private banks can also implement the same feature (if directed by RBI)
1.2.3 Electronic Mass Payment System
The banking industry in India has been enjoying the benefit of Smart Card concept over
the years. Smart Card can be in the form of Credit Cards / Debit Cards, Kissan Credit
Card etc. These devices are used either to take money on loan from the bank or draw
money out of the credit balance available in your bank account. Electronic Mass


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Payment concept essentially requires use of Smart Card by each and every citizen in the
country. However, in India the low income households have very little awareness of
banking, credit, debit and other related activities through which they can enhance and
protect their financial resources. In fact, the banking sector has taken a lead role in
promoting financial inclusion. Unfortunately, over half of the population in India is
unbanked. Only about 55% of the population in the country have deposit account and
around 9% have credit accounts with bank. According to data from Reserve Bank of
India (RBI), India is the home to largest number of unbanked families. (more than 145
million). There is only one bank branch per 14000 people. The total number of villages
in the country is estimated to be around 6 lakhs, but the number of scheduled commercial
banks (SCBs) and Regional Rural Bank stands at only 33495. As such, the need of
stepping up opening of banking arrangement in rural areas to ensure Electronic Mass
Payment in the country appears to be an inescapable necessity. To proactively encourage
electronic payment systems for ushering in a less-cash society in India and to ensure
payment and settlement systems in the country are safe, efficient, interoperable,
authorized, accessible, inclusive and compliant with international standards. The Vision
Statement indicates RBIs renewed commitment towards providing a safe, efficient,
accessible, inclusive, interoperable and authorized payment and settlement systems for
the country. Payment systems will be driven by customer demands of convenience ease
of use and access that will impel the necessary convergence in innovative e-payment
products and capabilities

Even the RBI issued a Vision statement on 1
st
Oct,2012 regulating Electronic Mass
Payment System for ushering in less-cash society in India and to ensure payment and
settlement system in the country are safe, efficient, inter operable, authorized, accessible,
inclusive and comply with international standards. The vision statement for a less- cash
society if not cash-less society, the key elements which would impact all over efforts
towards creation of a modern and widespread payment system are Accessibility,


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Availability, Awareness, Acceptability, Affordability, Assurance and Appropriateness (7
As):
i. Accessibility: Access to formal payment systems, including e-payments as
indicated above, is not available to sizeable sections of the society.
ii. Availability: Availability of the modern payment systems beyond the banking
relationship has now been made possible through non-bank entities as well after
the enactment of the Payment and Settlement Systems Act, 2007.
iii. Awareness: The usage of a payment product is dependent on the customer being
aware of the existence of such a product and its use as also the safeguards against
its misuse
iv. Acceptability: Availability and awareness of payment products will not lead to
increased usage unless the payment product is accepted by all. The acceptability
of formal payment channels including e-payments is based on the ease of use,
convenience, interoperability, language neutrality and incentive factors associated
with the particular mode of payment.
v. Affordability: The payment services, including the e-payment option, should be
affordable to all segments of the society. Effective technology deployment and
incentive structure should result in the creation of low cost payment products that
encourage all customers and users towards their repetitive usage and cut down
their dependency on cash.
vi. Assurance: It is an aspect which is related to trust in the products and processes
and the security and authenticity relating to the transactions.
vii. Appropriateness: Appropriateness is the combined effect of all the above
features..
Thus, the entire banking sector in India has been directed by RBI to ensure compliance of
the vision statement characteristics to encourage Electronic Payment System in the
country smoothly.
1.2.3.1 Main Basic Features of Electronic Mass Payment System


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1. The Electronic Mass Payment System will increase efficiency and effectiveness and
enhancement in payment system: To provide agility and dexterity - the combination
of speed, efficiency, interoperability and standardization in payments systems that
would enable all stakeholders (users and providers) to realize their needs without
compromising the quality of service through a proactive regulatory and policy
framework like:
Cheque clearing
National Electronic Funds Transfer System (NEFT)
National Electronic Clearing Services
Settlement in central bank money
Regulatory and policy framework for inducing efficiency
Rationalize the guidelines for payment systems
2. Standardization, portability and inter operability in the systems: Development of
common standards for payment systems and strive towards interoperability and
portability of payment systems.
Development of common standards for payment systems and strive towards
interoperability and portability of payment systems.
Harmonization of routing codes
Standardization of account numbers
Standardization of bill payments
3 Development of infrastructure and integrated payment system: The payment system
infrastructure in the country which is well developed and robust in terms of
processing capability, scalability, reliability, resilience and availability to be further
augmented to ensure safety, security, robustness for providing low cost transaction
processing.
Capacity building of existing payment infrastructure
Expansion of payment infrastructure
Building an integrated payment infrastructure


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4 Capacity building in terms of human resources building and integrated
infrastructure
5 Risk Management in payment systems
The smooth operations of payment systems
Safety and Security of Electronic transactions
6 Access, Availability and Awareness
Promote access and inclusion
Payment system literacy and visibility
7 Move towards a less-cash society
Innovation & new product developments
Move towards a less-cash society
8. Monitoring and Review: One of the major focus of the Vision Document is to
popularize adoption of non-cash payments and strive towards a less-cash society.
Policy initiatives and measures would be oriented towards achieving these objectives.
There is, however, a need for periodic review of the progress made.
1.2.3.2 Assessment of the Electronic Mass Payment System
Impact
Cashless and fast mode of payment
Easiness in the operation leads to high customer satisfaction
Utility
Efforts to bring whole nation under the ambit of electronic mass payment system
will be made.
Payment system will be driven by customer demands of connivance, ease of use
and access that will impel the necessary conversion to innovative e- payment
products and capabilities.
Integration of various systems through unified solutions architecture and current
technology would lead to adoption and uses of resilient payment system.


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Regulations will channelize innovation and competition to meet these demands
consistent with international standards and best practices.
It will provide a base for healthy financial management from banking industry
point of view.
Sustainability
Provided the entire infrastructure in terms of manpower technical support
,financial support and administrative support along with the healthy in-built
safety and security of the system is directly proportional to the customer
confidence. It is the customer confidence which acts as then key factor to the
sustainability in terms of increased number of customer opting for e-payment
system thus ensures sustainability of the project.
Scalability
The scalability of the project is related to infrastructure needs with reference to
the expansion of a area ( domain or field ) of the project. As per our assessment
scalability of the project appears to be viable proposition.
Replicability
Replicability of certain components of the project may be necessary in future in
order accommodate the expanding and increasing areas of operations and
application needs to ensure completeness of the system as a whole.


Table 1: The summery of the three assessment parameter
Electronic Central Registry One India One
Account
Electronic Mass
Payment
Impact 1.Prevent Frauds in loan
cases
2. Financial Assistance by
Banks
1. Efficient and Quick
Mode of operation
2. Transparency in
Transaction
1. Cashless mode of
payment
2. Fast Transactions
3. Easy to use.


25

3. Help in decision making
4. Positive Impact on
Overall banking especially
assets mortgage.
5. Financial and
Administrative process
becomes more effective
3. Fraud Detection will
be easier
4. Transparency in
system.

Utility 1. Number of loan cases will
grow
2. Financial assistance by
bank will be raised
3. Financial institutions
against immovable
property will achieve
fraud detection and
prevention
4. Utility in handling loan
cases will be very high.
1. Quick access to
transaction details
2. Healthy transaction
management
3. Increased comfort
zone of both parties
1 Efforts to bring all
nation ambit of
electronic mass
payment system
2 Customers driven
payment system
3 Integrated system
4 Innovative and
consistent system
with international
standards and best
practices.
5 Healthy financial
management
Sustainabilit
y
1. Sustainability is
automatically increased
as customer faith is
achieved by fraud
prevention
2. It leads to an integrated
system hence national
1. Sustainability is
directly proportional
to the customer
satisfaction
2. More is the
integrated system
more is the
1. It is the customer
confidence which
acts as then key
factor to the
sustainability in
terms of increased
number of


26

level frauds in loan cases
against immovable
properties can be easily
identified.
3. Good maintenance and
operational arrangements
envisaged needs to ensure
sustainability
sustainability customer opting
for e-payment
system thus
ensures
sustainability of
the project.

Scalability 1. If a system is highly
technical and well
organized than it supports
progressively over a long
time.
2. Process of increasing and
expanding basic needs
also supports system.
3. Proper maintenance
backing, reviewing and
monitoring mechanism
ensures healthy
scalability.
1. System is scalable
as it will
accommodate
increased user base.
1. The scalability of
the project is
related to
infrastructure
needs with
reference to the
expansion of a
area ( domain or
field ) of the
project

Replicability 1. Replicability of this
system at national and
state level will increase
with the increase in
number of users and time
requirements
1. Single account
number can be
treated as a unique
id.
2. This can be
replicated to state
and private bank for
1. Replicability of
certain
components of the
project may be
necessary in future
in order
accommodate the


27

the true essence of
one India one
account
expanding and
increasing areas of
operations and
application needs
to ensure
completeness of
the system as a
whole.
1.3 Research Methodology and Sampling
For the purpose of the baseline study, the unit of analysis was the entire PSB (Public
Sector Banks) covering a sample of selected 5 public sector banks? The research
methodology used for the study is discussed below in figure 1.









Banking MMP: Assessment
Selection of PSB & student
teams for Survey
Account holders
Design data collection form
Data Analysis & comparison
of services
Overall assessment of
selected PSB
Bank employees Bank web portals


28

Figure 1 Research Methodology
List of selected five PSB for study of Banking: MMP

1) Punjab National Bank

2) Oriental Bank of Commerce

3) Syndicate Bank

4) Central Bank of India

5) Bank of India

Students team structure for survey under guidance of faculty coordinators:
Selected Banks Students Team for Survey
Punjab National
Bank
1. Shivani Raghav , Shivani.raghav@asu.apeejay.edu, 09899642286
2. Nidhi Verma, nidhi.verma@asu.apeejay.edu, 08527044725
3. Abhinav Chauhan, abhinav.chauhan@asu.apeejay.edu, 09650138133


29



The study focuses on understanding and analyzing the experiences of end users of the
Public Sector Banks, since one of the primary goals of the NeGP is to emphasize the
citizen-centricity of services provided by government departments. The survey covered
both normal users as well as commercial users with computerized as well as manual
services offered by different Public Sector Banks all over the country as shown in fig.2.


Oriental Bank of
Commerce
1. Aakash Arya, akash.kumar@asu.apeejay.edu, 09971525538
2. Surabhi chauhan, surabhi.chauhan@asu.apeejay.edu, 08800100119
3. Akshay Singh, akshay.singh@asu.apeejay.edu, 09996020169

Syndicate Bank

1. Sonu Raj, sonu.raj@asu.apeejay.edu, 09999981669
2. Siddharth Sudhakar, siddharth.sudhakar@asu.apeejay.edu, 09867637024
3. Anurag Varshney
4. Alisha Virmani, alisha.virmani@asu.apeejay.edu, 09711714494

Central Bank of
India

1. kshitij Kumar Singh, kshitij22@live.com
2. Aayush Bhatnagar, aayush.bhatnagar@asu.apeejay.edu, 08295606218
3. Ashish Kumar, ashish.kumar@asu.apeejay.edu, 08295418243

Bank of India 1. Aashima Narang, aashima.narang@asu.apeejay.edu, 09671023212
2. Gursimran singh saini, gursimrans.saini@asu.apeejay.edu, 9910102543
3. Pooja Bajaj, pooja.bajaj@asu.apeejay.edu, 07838189373
4. Mishika Mukherjee, mishika.mukherjee@asu.apeejay.edu, 09560941282



30


Figure 2 various services offered by banks
Counterfactual

Since the goal of the study was to assess the impact of the e-governance initiatives, it was
important for the study to understand what would have happened had e-governance
initiatives not been implemented i.e. to have a counterfactual with which to compare the
experiences of those who have availed services related to the Banking-MMP. The
experiences are dependent not only on the service providers but also practical experiences
of different type of users.
The ideal counterfactual is of users who can report on their recent experience of both
computerized delivery and manual delivery for the banking service. In a situation where
mature projects are assessed, this condition will not always be met. Therefore the best
alternative is to have a separate group of users of computerized and users of manual
service who are similar in every respect except usage of computerized services. In the
case of the evaluation of Banking-MMP, random assignment was not feasible. Hence the
study compares the experiences of users with non-users for services where users still
have a choice between computerized and manual services. In cases where services are


31

only delivered in the computerized mode, users were asked to recall their experiences
under the manual system and compare it to the current computerized system.

Table 3 (As per different bank under study) provides information on the services that
were analyzed and the counterfactual used in each case. Few services that were most
commonly used and offered in the computerized mode across all banks are come under
category of e-services.
1.3.1 Design data collection form
Data collection form will include the following:
(a) Questionnaires:
Questionnaires for account holder
Questionnaires for Bank employees
Questionnaires for Bank manager
This is being designed to seek relevant information. These questionnaires will
administrated through physical team of students and faculty for each bank
(b) Personal Interviews: This will be in the form of check list to fill the gap of the data
collected through questionnaires .Interview will be arranged at the convenience of Bank
Manager(this will be require authority from Engineering Watch) to have free access to
the Managers and seek inputs.
1.3.2 Sampling Plan, Sample Size and Profile
Sampling Methodology and Sample Size

The sample size was restricted to 20 interviews/questionnaires for Account holders and 5


32

Interviews/ questionnaires for Bank employees, from each of the Banks from rural/ urban
segments and information available on respective bank web portal. As mentioned earlier,
the sample was divided almost equally between users of computerized services and non-
users of computerized services in each bank where all the evaluated services were being
delivered by both modes. In banks where one of the evaluated services was only being
offered in the computerized mode while the other service was being offered in both
modes, the sample was further sub-divided based on activity levels and multiple
parameters are taken as measurement framework for study as described below.
Measurement framework for study
Ratio of users who are using computerized and non-computerized services
Awareness about central registry act.
Cost of availing service measured directly & indirectly
Number of trips made for the service
Average waiting time in each trip
Total time elapsed in availing service
Amount paid as bribe to functionaries
Amount paid to agents to facilitate service if any
Preference for manual versus computerized systems
Quality of Service: Interaction with staff, complaint handling, privacy, accuracy
measured
Satisfaction with the location of the service delivery center/office
Convenience of working hours of the service delivery center/office
Overall attitude of the functionaries in terms of courteousness and friendliness
Timeliness of response to queries by clients
Satisfaction with the mechanism for complaint handling and problem resolution
Perception about the confidentiality and security of data
Satisfaction with the overall quality of service


33

Quality of Governance: Transparency, participation, accountability, corruption
measured
Level of corruption in the current working system
Awareness about the citizen charter
Adherence of the time frame for service delivery (elapsed time)
Financial loss due to delay in availing the service
Extent to which government officials can be held accountable for their actions
Whether the rules and procedures are simple and stated clearly
Perception about the overall quality of governance
Other e-Governance scheme run by individual bank
Unique customer identification maintained by bank
Mode of electronic mass payment system adopted by banks etc.

An outline of the survey instrument that incorporated the key dimensions in the
measurement framework was prepared. The instrument was adapted to distinguish
between services that are compulsorily offered only through the computerized mode and
those where users can choose between the manual and computerized mode. In particular,
information was collected on all elements that define the cost (including time cost) of
accessing a popular service such as opening account that can be accessed both via the
online and manual mode to compare the two modes in details. The elements included
man-hours spent in completing forms and preparing supporting documents, data entry,
trips made, service charges and use of intermediaries.

Profile of Respondents
Some attributes indicating the profile of respondents (user as well as banker). The
majority of account holders/ users are of manual type, but with current time e-banking
also increasing exponential as per survey conducted (But no actual ratio is provided by
selected banks).


34

1.4 Data Analysis & comparison of services
Received data from different Banks will be analyzed on common set of standards to
determine number of services and customer satisfaction as per the measurement
parameters taken from standard framework for impact assessment and base line study for
mission mode projects.
1.4.1 Value Delivered by the Online Applications

Every PSB provides various online services like Internet banking, Mobile banking,
ASBA, Share trading, Loan application, E-tax payments, Money transfer, Security alerts,
global credit card, Online loan application & tracking and Bill payments etc. These
services vary bank to bank. Some of the e-services offered by five PSB are compared in
Table 2 to evaluate efficiency of individual bank in different aspects.
Table 2: Comparison of multiple services provided by different banks
Services provided by
banks
OBC PNB Syndicate Central Bank
of India
Bank of
India
Mobile banking Yes Yes Yes Yes Yes
Net Banking Yes Yes Yes Yes Yes
Online Complaint
System
Yes Yes Yes Yes Yes
Marketing/Distribution
of Mutual Funds Units/
Insurance etc
Yes Yes Yes Yes Yes
E-tracking PMEGP
application
Yes Yes Yes Yes Yes


35

Utility bill payment Yes Yes Yes Yes Yes
MSME Loan Yes Yes Yes Yes Yes
E-Taxes Yes Yes Yes Yes Yes
E-Shoppe Yes No Yes Yes Yes
Direct/share Trading Yes Yes Yes Yes Yes
Car Loan Yes Yes Yes Yes Yes
Housing Loan Yes Yes Yes Yes Yes
Online S/B account
opening
Yes Yes Yes Yes Yes
Education Loan Yes Yes Yes Yes Yes
ASBA( Application
Supported by Blocked
Amount)
Yes Yes Yes Yes No
VBV Registration Yes No Yes Yes Yes
Online Loan
application & tracking
Yes Yes Yes Yes Yes
Money transfer Yes Yes Yes Yes Yes
Security alerts Yes Yes Yes Yes Yes
Global credit card Yes Yes Yes Yes Yes
Bill Payments Yes Yes Yes Yes Yes
Gift Card Balance
Enquiry
No No No No Yes
Speed Remit Yes Yes No No Yes
Star e remit (transfer
the money in other
countries)
Yes Yes Yes Yes Yes
1.4.2 Comparison of the Project across Key Dimensions


36

Analysis of Survey Data
Submission of report providing an assessment of the citizen impact on the following
dimensions for each of the five Banks for key services offered by them are described in
Table 3 and Table 4..
One India one account
Central registry Act
Electronic mass payment system
Factors contributing to cost of access (number of trips needed, waiting time, travel
costs, payment of bribes)
Elapsed time (total time taken for receipt of final document)
Quality of service assessed along attributes such as responsiveness of staff,
convenience of location of office and work timings, and facilities at the service
center.
Quality of governance assessed on attributes such as transparency, reduced
corruption, and fairness of treatment, quality of feedback and level of
accountability.
Overall impact measure (preference between manual and computerized systems)
Total no. of service branch of all banks.

Respondents were asked to rate the improvements on a common set of twenty attributes
covering cost of access, convenience, quality of delivery, and quality of governance. For
each project the respondents were also asked to select the three most desirable attributes.
Based on the responses on desirability, a weighting scheme was generated for each of the
attributes reflecting the importance of the attribute. Using the weighting scheme and the
responses, a single composite score for improvement was generated.

1. Cost element-wise impact: An aggregate picture of overall impact for a given project
covering all dimensions across nation.
2. Service-wise impact


37

3. Time factor (efficiency)
4. Security/ Fraud detection
5. Other point for assessment like Scalability, Sustainability, impact, utility, Replicability
etc.
Table 3: Assessment Study for selected PSBs

Electronic Central
Registry under
Sarfaesi Act, 2002

One India One
Account
Electronic Mass
Payment System
Punjab National
Bank
Maintained by CIBIL
Report
One India One
Account is
maintained by
Master ID with
in Bank (But
Multiple
Accounts of the
same customer
are there)
Maintained By
ECS (Electronic
Clearance
Services),
TDS, PPFs,
PMRG, VISA,
ATM cards etc
Oriental Bank of
Commerce
Updated By Central
Registry Web Portal
Link
One India One
Account is
maintained by
Master ID with
in Bank (But
Multiple
Accounts of the
same customer
are there)
DBT (Direct
Benefit Transfer)
NEFT
Kisan Card
RTGS, VISA,
ATM cards etc.
Syndicate Bank

Updated By Central
Registry Web Portal
Link
One India One
Account is
maintained by
Master ID with
in Bank (But
Multiple
Accounts of the
same customer
are there)
Syndicate Kisan
Credit Card
(SKCC),
Syndicate
General Credit
Card (SGCC),
ASBA, DBT
(Direct Benefit
Transfer) NEFT,
RTGS, VISA,
ATM cards etc
Central Bank of
India
Updated By Central
Registry Web Portal
One India One
Account is
DBT (Direct
Benefit Transfer)


38

Link maintained by
Master ID with
in Bank (But
Multiple
Accounts of the
same customer
are there)
NEFT
Kisan Card
RTGS, VISA,
ATM cards etc.
Bank of India Updated By Central
Registry Web Portal
Link
One India One
Account is
maintained by
Master ID with
in Bank (But
Multiple
Accounts of the
same customer
are there)
Star e remit, BOI
speed remit,
MSE, SME loan,
star token,
ASBA, DBT
(Direct Benefit
Transfer) NEFT,
RTGS, VISA,
ATM cards etc

1.4.3 Overall Assessment
Overall assessment of the Banking MMP are based on Service-wise impact (calculated
based on total service center or branched of respective banks, No. of ATMs etc), Time
factor (efficiency based on total number of customers with respect to service wise
impact), Security/ Fraud detection (Security system used by individual bank, security
alert services, Security guidelines are available online etc.), quality of service time( based
on first two factors) and quality of governance(assessed on attributes such as
transparency, reduced corruption, and fairness of treatment, quality of feedback and level
of accountability). Overall assessments on above parameters are described in table 5.
Table 4: overall assessment for study

Banks/
Services
Total branch/
ATMs
Financial
performance
(2012-13)
Total business
in INR crores
Security
Aspects
Quality of
service Time
(Scale used)
5-execellent
4-Good
3-Average
2-Below Avg
1-Poor
Quality of
governance
(Scale used)
5-execellent
4-Good
3-Average
2-Below Avg
1-Poor
OBC connectivity for
more than
3,06084 Security
guidelines
4 3


39

52000(others +
1292 OBC)
ATMs
are available
online as
well as with
security alert
messages
PNB 5874/ 6059
ATM Across
764 cities with
over 80 million
customer
7,00285 Very good
in aspects of
security
alerts for
internet
banking/
Debit cards/
Shopping/
use of Win
32Mabezat
system
4 4
Syndicate
Bank
2700/1,640 215,122 Security
guidelines
are available
online as
well as with
security alert
messages
4 3
Central Bank
of India
4100/ 1841 1,91495 Online
Customer
Education
Series for
security/
security
alerts for
internet
banking/
Debit cards/
Shopping
etc.
4 4
Bank of India 4545/ 1727 456,406 Online
Customer
Education
Series for
security/
security
alerts for
internet
4 4


40

banking/
Debit cards/
Shopping
etc.
1.5 Analysis of Qualitative Feedback and Suggestions
There are some suggestions for improving online services, centralized banking, and
electronic mass payment system.
These suggestions cover improvements in hardware, improved application
software design, better training of staff and process reforms.
Some suggestions for increasing the uptake of e-services.
The reasons relate to adequate processing capacity in the department resulting in
long queues.
More counters, better training, improved technology, increasing productivity
would help in reducing queues.
Corruption can be minimized by an end-to-end online delivery in which the
unnecessary discretion available to officials is minimized.
Multiple service centers and ATM services.
Transparency in transactions( security issues)
Improved centralized banking
Easy and simplicity of banking process
Awareness campaigns on online services for users
Establishment of common service centres to facilitate e-services to all
Online processes should be made much more user friendly & simple
1.6 Conclusion
The MMP is being implemented by the banking industry which aims at streamlining
various e-services initiatives undertakers by individual banks, e-governance
implementation is done by the banks concerned with the banking Department providing


41

a broad framework and guidance to them. Out of three components of the MMP, the
component of Electronic of Mass Payment System may not take up for implementation
because banks are independently taking up their own initiative on this front. The other
two components i.e. Electronic Central Registry and One India one account for Public
Sector banks have been referred to Indian Bank Association. But current scenarios to
streamlining all these three main components are not actual in practice. But with time this
is growing very fast. After fully implementation of the Banking MMP objectives, the
sustainability, scalability, efficiency and transparency in banking system are achieved as
per agenda of e-governance.

The National e-Governance plan aims at improving delivery of government services to
citizens and businesses with a view to make all govt. services accessible to a common
man in his locality through common man delivery outlets and ensure efficiency
transparency and reliability of such services at affordable cost to realize the basic needs
of the common man. Impact assessment of the study leads to prevent frauds in loan cases,
strengthen decision making policy, financial and administrative process becomes more
effective, helps in efficient and quick Mode of operation, and leads to transparency in the
transaction. In the same manner utility, sustainability, scalability and replicability of this
system at national and state level will increase with the increase in number of users due to
positive outcomes of proposed system beside of few limitations.