The following companies are allowed to become the authorized business correspondents of banks: commercial correspondents are used by banks as retail agents to offer banking services to their customers. They therefore play an important role in expanding the reach of banks through bank kiosk facilities where services and products are available at an affordable cost. Kiosk outlets are connected to the Internet and serve as a convenient platform for the use of basic services, including opening a no-frills account with no minimum assets, transactions within 10,000 rupees per day and small deposits of securities, as well as products such as pension products, other third-party products, etc. While these kiosks run by trade correspondents guarantee customers a safe and trouble-free banking experience, these retail branches also enjoy some advantages in terms of good incentives. A sales correspondent could serve as a BC for more than one bank, and at the time of the customer interface, the retail office or sub-agent of BC Bankservice should only represent and provide to a particular bank. The terms of the contract between the Bank and the BC must be carefully defined by written agreements and subject to thorough legal scrutiny. The business correspondent should comply with the instructions set out in the contract. Business correspondents play a central role in providing important banking institutions to financially excluded members of society in remote areas where banks are not present. The business correspondence model is actually a partnership model in which each partner has a particular role to play. Through its outstanding contributions to the Indian e-governance segment, Alankit Limited has distinguished itself by ensuring rapid provision of traditional banking and financial services throughout India, especially in villages and rural areas. The company has worked with leading public sector banks, the State Bank of India (SBI) and the Bank of Baroda, to set up kiosk bank branches in cities. Business correspondents provide last mile banking services to millions of customers on behalf of banks.
The activities they carry out must be carried out in the context of the normal banking operations of the bank concerned, but must be carried out by and by the institutions located in places other than the premises of the Bank. With regard to all such transactions, the business correspondent, his representative, is authorized to accept or deliver cash either to his place of work or to an appropriate place subject to the journal / per customer limits, as indicated. The BCs are connected to the bank`s neighbouring branch (also known as the base branch). Professional correspondents operate on the basis of a commission model. They receive a commission from the bank on the services they have provided, such as any new accounts opened to customers, money transfer transactions or new credits paid. According to the RBI, banks must pay an appropriate commission to their BCs.