Microfinance Focus, January 13, 2011: India’s largest private sector bank ICICI bank Ltd and mobile network giant Vodafone Essar have inked a pact on Wednesday to drive financial inclusion in India by offering mobile banking to the un-banked and under-banked population in the country.

Meanwhile, India’s largest public sector bank, State bank of India too has joined hands with telecommunication company Bharti Airtel to offer mobile banking to India’s unbanked millions. Bharti Airtel will become the Business Correspondent for SBI and offer banking products and services at affordable cost to the citizens in unbanked regions.

Under the tie-up, ICICI and Vodafone will together offer financial products such as savings accounts, pre-paid instruments and credit products through a mobile phone based platform. Both parties will work out the specific arrangements in the coming few weeks and chart out a go-to-market plan.

Vodafone currently has operations across the country with over 120 million customers. ICICI Bank will leverage the distribution strength of Vodafone, which manages over 1.5 million retail points for acquiring customers and servicing them.

The Reserve Bank of India (RBI) has over the past few years come out with various measures to facilitate banks to achieve the financial inclusion agenda. RBI has allowed banks to appoint for-profit' companies as Business Correspondents (BCs). This tie-up between ICICI Bank and Vodafone is a step in that direction.