Time and again, the Indian government comes out with platforms and schemes to help the Indian customer with online payments. DigiSaathi is such an initiative that was introduced on March 8, 2022.

The Reserve Bank of India (RBI) alongwith the National Payment Corporation of India (NPCI) launched DigiSaathi – which will help customers with digital payments including cards. The RBI also launched the UPI123 pay service for offline UPI payments.

According to Shri T. Rabi Sankar, the deputy RBI Governor,

“This initiative will help address customers’ queries in the digital payments umbrella including cards. Right now it is available in two languages – English and Hindi; we are working towards including all vernacular languages. Going forward, human intervention could also be included.”

The customer can submit queries and the most relevant information will be delivered as soon as possible. The questions asked will be examined regularly and the FAQs will be kept up to date.

What is DigiSaathi and how will it help customers?

DigiSaathi is a 24-hour information hotline for digital payments made against goods and services. It is set up and controlled by the NPCI to help the Indian payments industry. Different industry participants have joined to create the website, chatbot, and mobile/web application to help end customers with products and services. This is RBI’s digital vision.

AI bots maintain the backend and they will be taught over time to improve the accuracy of their answers and replies.

The platform is a one-stop destination to obtain help on the entire spectrum of digital payments. It will assist users through the chatbot facility or toll-free calls where users can dial and call out options and products for which they need information.

When a user types in the query, related questions are auto-suggested and you can choose your question from the list. Once you click on the question, relevant information will be displayed.

The working committee for DigiSaathi includes NPCI, State Bank of India, Bank of Baroda, Axis Bank, GPay, Indian Banks Association (IBA) and Amazon Pay, among others.

You can also register complaints and report fraudulent transactions. There are details and email addresses of banks and financial institutions as well.

Visit the DigiSaathi website in case of any queries! The helpline service is also available at 14431 and 1800 891 3333 for support in both English and Hindi.

The service will be made available on more social media channels to fulfil customer requirements.

Neo-banks are online-only fintech companies without physical branches. They are digital banks.

How are they different from traditional banks?

Neo-banks are revolutionizing the traditional banking system by leveraging artificial intelligence (AI) and technology. They offer personalized services to customers. Traditional banks have a physical and maybe a digital presence while neo-banks, led by a design thinking approach, tailor-make their products and services to make banking convenient for the end customer digitally.

Neo-banks are driven by innovation and technology and can develop partnerships and launch features quickly. They cater to small and medium businesses and retail customers.

History of neo-banking

The term neo-bank started gaining popularity in the year 2017 with the rise in the usage of smartphones and the internet across the globe. They are also known as ‘challenger banks’.

As per a report by KBV research, the market size of neo-banking globally is expected to reach $333.4 billion by the year 2026. The CAGR is a whopping 47.1%.

Despite the potential market size, the concept of neo-banks is relatively new in India. Some neo-banking firms have recently raised funding from global investors given the huge underbanked market potential that India has.

India’s top neo-banks include RazorpayX and Jupiter.

How do neo-banks work?

Neo-banks have a different business model than traditional banks. Since they are completely online, customer fees are slashed significantly. Being customer-centric platforms, they can devise personalized services through innovation and technology.

The decisions taken by neo-banks are data-driven. They use technology-led solutions to collect and analyze data and understand customer behaviours. This enables them to offer a wide window of advantages and opportunities to their consumers

What are the challenges faced by neo-banks?

The first issue they face is fostering trust. Customers might not be able to depend on them in case of issues/challenges, as there is no physical presence. Hence, they offer freemium subscriptions and memberships to allow users to experience the service before paying for it.

Due to the absence of regulations, neo-banks cannot offer lending products or accept deposits. Hence, some fintech firms have an NBFC as their parent company to engage in lending activities. They can also rely on bank partners to offer services.

Although India’s smartphone penetration rate is set to increase by 96% by the year 2040, financial inclusion levels are yet to improve.

Advantages of neo-banks

1. Since the regulations are few, neo-banks can keep their costs low. Their products are inexpensive and have no monthly maintenance fees.
2. They offer majority banking services through an app.
3. It allows customers to set up accounts quickly and process requests. Processes that usually are time-consuming, can be done faster with the innovative strategies of neo-banks.
4. Neo-banking apps provide you with smart reporting via an overview of your expenses along with a savings goal best suited for your needs. This enables better management of finances.

Disadvantages of neo-banks

1. Since the RBI does not recognise neo-banks, customers may not have a defined process in case of an issue.
2. Customers don’t have in-person assistance.
3. Neo-banks have expertise in specific products.

Takeaway

The financial landscape is shifting towards customer satisfaction and experience. Neo-banks are attempting to fill that gap. They have the potential to be much more than just a buzzword in the fintech community and hopefully, in the years to come, they will change the face of banking forever!