In today’s financial landscape, it is through step-by-step inclusion one can come into the sphere of banking and get the modern benefits that the banks are providing. In this activity, the Direct Selling Agent (DSA) plays a major role in incentivizing people to come into the traditional banking system.
With the help of these agents, one can get access to various financial products, which people can now get access to, and through them, one can get introduced to a large range of financial products that one can use.
In this blog, we will discuss some of the benefits of having DSA partners, how banks and other NBFCs can take their help to expand the business, and how they include a large population in the modern financial system.
1. Democratizing Finance Through DSAs
DSAs play a major part when it comes to including people in the financial system. When it comes to a broader audience or people in the lower income strata, it’s the DSAs who aim to growthinsta include them in the financial system.
Nowadays, modern financial service depends on the shoulders of the layman who keeps their money as a form of savings in the traditional banking system, and that helps the country and its businesses grow and expand.
Once the person comes into the financial service, it helps the bank increase its current and savings account rate. It is also beneficial for the individual as they now will get an interest payment for keeping their money in the bank.
2. Bridging the Gap: DSAs as Intermediaries
DSAs play a crucial role in the relationship between financial institutions and potential borrowers. In the village or the countryside, there are a lot of potential borrowers who might need capital to do their agricultural activity. For that reason, it’s the role of the DSAs to facilitate this process menuupdate com.
Previously, if a farmer wanted to borrow money from the traditional banking systems, they needed to go through a lot of documentation process, and that used to consume a lot of time. Hence, a farmer generally goes to the informal money lender, who takes a huge interest rate on that initial capital.
Thus, in one bad agricultural season, a farmer may fall into a debt trap, and that becomes a burden for that person to repay that debt along with interest. Here, the DSAs offer loans in a personalized manner, and based on the understanding of the credit profile of that person, a DSA agent can finalize the loan amount and create a profile of that person; based on that, the person will get credit from the formal banking system.
3. Access To Variety of Lending Products
For a person who is not inside the banking domain, it’s tough to know about the different financial products one can avail. It’s the role of the DSA agents to make the borrowers aware of different lending products.
For example, a farmer wants to take loans for their agricultural operations, and for that, they can go to a lender; however, there are certain financial products like agricultural loans that offer flexible repayment options and allow a person to comfortably return the principal amount and return the money with low-interest rates ddyfa.
In another case, if one wants to build a home, then a person doesn’t need to take a loan at high interest and pay it accordingly. Now, one can choose a specific loan based on one’s activity; hence, the idea of a home loan has emerged. In this process, a person doesn’t need to gather a lot of capital to complete their home; rather, they need to pay successive amounts on a monthly basis.
4. Streamlining the Application Process
Previously, the loan application process was quite tedious, and mainly due to that reason, people don’t trust the traditional banking system. This problem is now being solved mainly due to the DSA partners who are facilitating the application process.
These are some of the benefits of the DSA partners and their roles in making the banking system efficient and inclusive.
