Company Confidential 1 100% Financial Inclusion is a stated goal - Telcos can be the biggest catalysts to achieve that

Company Confidential Hard facts about Soft Issues More experience in serving targeted customers –Mobility penetration in non urban areas is higher and growing fast Huge investment in brand – focus on high quality and integrity of service delivery Soft investment is more important –Customer training and education –Channel Management Familiarity of operating in a regulated environment –KYC and QOS as per regulation Mobile technology is secure and accessible – High levels of privacy/security at low cost of entry

Company Confidential Mobile subscribers growth pattern Data interpretedSource: RBI 2006, COAI

Company Confidential Telco outreach Estimates, Figures in 000sSource: National Census, RBI, COAI

Company Confidential Invest large sums in developing brand Invest large sums in deploying technology Established financial strength and stability Large existing customer bases High stakes for a Telco Telcos have attained Customer trust

Company Confidential Unique Bank-TelCo partnership Best of both worlds –TelCo’s existing relationship with customer –TelCo’s knowhow on customer handling –TelCo’s knowhow on customer education & service –Bank’s knowhow on Banking regulation, best practices & AML –Bank’s knowhow on Cash Management Cost optimization for banks –Less viability for banks to run accounts with < Rs. 5,000 AQB Ride the TelCo’s channel to achieve reach Using customer history for future product offerings. E.g. microfinance loans

Company Confidential Redefining roles – Enable Financial Inclusion Customer registration & access Assist in KYC Acceleration of Penetration Customer Care Distribution & Outreach Technology Solutions Creating usage avenues Open Accounts Implement AML & KYC guidelines Customer grievance guidelines Custodian of customer monies Best banking practices Interest payments Offer range of Banking products TelCoBank Equal partners – balanced roles

Company Confidential Regulation – consultative approach Proportionality –Risk-based approach Mobile experience –As different to traditional approach Innovation –Innovative services may not fit well within existing regulation categories Guiding principle - Customer security and benefit

Company Confidential Economy Extends economic inclusion to rural poor Starts rural people on the ladder of banking Reduces urban rural divide Regulator Achieving Financial Inclusion objectives faster Maintaining Control Bank Increases reach at viable cost – network benefits Additional revenue streams Lower costs TelCo Additional revenue stream Customer stickiness Customer Economic independence Preserves Confidentiality Greater Convenience Transaction speed Benefits of Success

Company Confidential Thank you