ROINet Empowers India's Financial Inclusion with Last-Mile Network

In a nation as vast and diverse as India, the journey towards comprehensive financial inclusion remains a monumental challenge. While economic growth soars, a significant portion of the population, particularly in rural and underserved areas, still lacks access to basic financial services. This disparity creates a critical gap, hindering individual prosperity and national development. Addressing this profound issue is Sameer Mathur, the visionary Managing Director of ROINet, a company dedicated to building India's largest last-mile financial services network. In a recent conversation, Mathur shed light on ROINet's mission, its unique approach, and the transformative impact it's having on millions of lives across the country.

The Persistent Challenge of Financial Exclusion

Financial inclusion, at its core, is about ensuring that every individual has access to useful and affordable financial products and services. For decades, both government bodies and private organizations have grappled with this complex problem. Mathur highlights that in developing countries like India, a large segment of the population remains outside the formal developmental cycle. While India's GDP has seen significant growth, the per capita income hasn't risen proportionally, indicating that wealth concentration at the top leaves many behind.

Mathur emphasizes, "If any country needs to truly grow, you know move from being developing to develop, it has to ensure that this large mass of people get included as a part of their development cycle. And the starting point is what they call as access to basic financial services." He points out that providing 70 to 80 crore Indians with access to payment services and loans could unlock immense entrepreneurial potential, boost productivity, and significantly elevate per capita incomes, ultimately driving national GDP.

A Private Sector-Led Solution for a Public Problem

The traditional approach often saw governments leading the charge in such initiatives. However, Mathur argues for a more efficient model: "85% of any business model which hits the ground has to be the private sector or the private people taking own issue for it. The role of the government is to govern, is to set up basic processes, system etc. But the role of the private sector is to take those models and get into the crowd." This philosophy underpins ROINet's strategy.

Mathur's journey into financial inclusion began during his full-time MBA at MIT Sloan, where he collaborated with Harvard Business School students on a project exploring how private companies could address this global challenge. The timing was opportune, as the Indian government was creating a framework for private players to partner with financial institutions. Initiatives like Aadhaar and Jan Dhan laid the groundwork, providing the fundamental infrastructure for companies like ROINet to execute on the vision of widespread financial access.

ROINet's Unique Ecosystem: The Business Correspondent Model

ROINet's success is deeply rooted in its innovative business correspondent (BC) model, a framework established by the Reserve Bank of India (RBI) that allows private entities to partner with banks. This model enables the creation of low-cost banking centers, effectively extending the reach of traditional banks into remote villages where physical branches are unviable.

Mathur explains the critical need: "India has 6.5 lakh villages in India, total nationally only about 15% 10 to 15% of the villages are covered by the bank branches." ROINet steps in to bridge this gap by establishing "mini bank branches" or franchisee points. These service points are typically run by local entrepreneurs, often existing Kirana store owners or pharmacists, who already possess a captive client base and deep community trust.

The investment required to set up a ROINet service point is remarkably low, starting from as little as 7,000-8,000 rupees for a mobile phone, fingerprint device, and printer. This accessibility allows individuals to take on financial services as a second line of business, leveraging their existing infrastructure and community ties. The signage at these points prominently features the partner bank's brand alongside ROINet's, instilling confidence and trust among customers.

Evolving Definition of Financial Inclusion: Beyond a Bank Account

Mathur notes that the definition of financial inclusion itself is evolving. While a decade ago it primarily meant having a bank account, today it encompasses a broader spectrum of services. "I think if you look at the true concept of financial inclusion is when I would say all elements of the financial model is kind of covered as far as the customer is concerned," he states. This includes:

• Payment services
• Insurance (life and health)
• Access to capital for small businesses and personal needs
• Building a digital credit history

Thanks to initiatives like Jan Dhan Yojana, India has seen a massive surge in bank accounts. However, the next frontier is credit access. Mathur highlights innovative products emerging, such as securitized cards against fixed deposits, which help individuals build a credit history even without a prior CIBIL score. He optimistically predicts that India could achieve comprehensive financial inclusion, covering all these elements, within the next 10 years.

Products and Services: A Comprehensive Financial Hub

ROINet's service points are designed to be comprehensive financial hubs, offering a wide array of products and services that go beyond basic banking. While they don't handle checks, they provide a simplified version of savings accounts (Jan Dhan accounts) with transaction limits. Beyond that, the offerings are extensive:

• Travel portal for booking air tickets
• PAN card services
• Mutual fund products
• Insurance products

The vision is clear: to make almost every financial product available through a single portal at these last-mile service points. This broadens the financial toolkit available to rural populations, enabling them to manage their finances more effectively and participate in the wider economy.

Overcoming Challenges: Training, Localization, and Technology

Operating a vast network of nearly 4 crore customers and 3.78 lakh service points comes with its own set of challenges. Ensuring the credibility and consistent service quality of partners is paramount. ROINet addresses this through continuous investment in training. Mathur emphasizes the importance of localization in training, with trainers speaking local languages across different states. "It's very important that the trainers have to be speaking a local language and that's something we've always believed that has been our differentiator," he states.

Technology plays a crucial role in scaling training and support. ROINet has developed a learning management module for partners to get trained digitally. Furthermore, recognizing the trend towards localization in digital products, ROINet's portal is available in almost 10 languages. They are also investing in dynamic, multi-lingual chatbots, developed in collaboration with IIT Delhi, to provide instant support and disseminate information to their extensive network of partners.

The Future: Graduating Financial Inclusion and Assisted Models

Looking ahead to a future where basic financial inclusion is achieved, Mathur believes the journey doesn't end. Instead, it evolves into "graduating" customers from basic financial products to more sophisticated ones. This iterative process will span decades, with new products and solutions continually emerging. He envisions moving customers from "level A" to "level C" of financial sophistication.

Despite the rise of digital, Mathur firmly believes in the enduring need for an assisted model, especially for the "Bharat" (rural India) segment. Customers still value human interaction, trust, and the ability to clarify queries with a person. Just as life insurance agents remain crucial despite digital alternatives, ROINet's assisted model provides the human touch that builds confidence and facilitates deeper engagement with financial products.

Mathur's message to aspiring entrepreneurs is clear: focus on solving real, widespread problems. Conduct thorough research to understand customer pain points, leverage your strengths, and ensure your solution is scalable. ROINet's journey is a testament to how a commercial model, when aligned with a profound social mission, can create immense value and uplift an entire nation.

Key Takeaways

Sameer Mathur's journey from MIT Sloan to building India's largest last-mile financial network offers crucial insights:

For Financial Inclusion: The Business Correspondent model is enabling 85% private-sector-led financial services delivery, reaching 3.78 lakh service points and serving nearly 4 crore customers.

For Entrepreneurs: Trust is the most valuable currency in underserved markets. Building credibility through local entrepreneurs and established partnerships creates sustainable competitive advantages.

For Policymakers: Technology and localization must go hand in hand. Multi-lingual support and assisted models are crucial for reaching the last mile effectively.

For Investors: Financial inclusion represents a massive opportunity. With only 15% of India's villages covered by bank branches, the addressable market is enormous.

For Development: The definition of financial inclusion is evolving beyond bank accounts to include insurance, credit access, and digital financial history – creating a comprehensive ecosystem.

About the Guest

Sameer Mathur is the Managing Director of ROINet, India's largest last-mile financial services network. With an MBA from MIT Sloan and a background in collaborating with Harvard Business School, Mathur brings a unique perspective to financial inclusion.

Under his leadership, ROINet has grown to serve nearly 4 crore customers through 3.78 lakh service points across India. The company's innovative Business Correspondent model bridges the gap between formal banking services and underserved communities, particularly in rural areas where traditional bank branches are unviable.

ROINet represents Mathur's vision of private-sector-led development, demonstrating how commercial models can align with social impact to create sustainable financial inclusion. The company's comprehensive financial hubs offer everything from basic banking services to travel bookings, PAN card services, mutual funds, and insurance products.

Mathur is a strong advocate for the assisted model in financial services, emphasizing that despite digital transformation, human interaction remains crucial for building trust and facilitating deeper engagement in underserved markets. His approach combines technology innovation with localized training and multi-lingual support to make financial services accessible to all Indians.