How SBI, Microsoft plans to boost digital banking in rural areas

SBI banks on Microsoft ‘white space’ for rural push, reports Anup Roy in Mumbai.

The country’s largest lender, State Bank of India (SBI), is in talks with Microsoft to utilise technology that will enable digital banking in rural areas with little access to telecom networks.

Microsoft’s India-born chief executive officer Satya Nadella is looking at the country as a major market to implement its so-called “white space” and “wide area WiFi or Wide-Fi” technologies - a concept that taps unutilised spectrum of television stations and cable TV network for internet access.

“We are experimenting with it (white space), but the security aspect of it is not established. We are hungry. In fact, Mr Satya Nadella is also talking with us for Wide-Fi,” said SBI’s deputy managing director and chief information officer Mrutyunjay Mahapatra.

Since July last year, Microsoft has been testing “white space” in Srikakulam in Andhra Pradesh. The technology harnesses free television airwaves unutilised by the national broadcaster to access internet and communicate over long distances through Skype. Wide-Fi uses existing cable TV networks in rural areas to provide internet access.

In a bid to hasten the government’s online and cashless push, SBI plans to use to technology to get more citizens to abjure cash.

“We are in talks with Microsoft (for white space). If they are willing to provide white space here, it will be very good,” said Dhananjaya Tambe, chief general manager (IT-operations), at SBI.  Microsoft’s Director for Corporate Communications Gayatri Rath did not respond to calls or e-mails.

SBI officials said the bank was also experimenting with other technologies as well to reach out to places where there are no reliable connectivity options.

For example, in the initial phases, the bank could take the help of V-Sat, or satellite technology, which already runs ATM networks across the country, to carry out digital banking. It is also experimenting with radio frequency (RF) technology to enable connectivity.

“We are now trying RF technology. In rural areas, there is unhindered visibility, which is required for RF. It cannot work in urban areas as there are large buildings hindering incoming frequencies,” said Mahapatra.

“We are not only a profit-oriented institution. We make profit, but that is incidental. The amount we spend on technology is more than four times of the next technology spender, which is from the private sector,” said Mahapatra.

For now though, SBI’s digital expansion is limited to only those places where connectivity is good.

“This is one area where we will have to collaborate with the government. We have already given this feedback to the government that we may have to expand only to those villages where connectivity is good. Because otherwise, even if we give the app and mobile, if the connectivity is unreliable, it will not work,” said Tambe.