Recognizing the critical role digital payments can play in deepening financial inclusion, Catalyst, a user-centric ‘digital finance innovation platform’ for the underserved last mile has rolled out multiple initiatives to help small business ecosystems (i.e. merchants, consumers, suppliers) to responsibly transition from an inefficient cash economy to digital payment platforms, using a targeted ecosystem approach. In collaboration with a mix of public and private partners, this multi-stage initiative includes, among other things, a set of research projects and operational initiatives centred on a low-income cluster, Bhatta Basti, in Jaipur City, where infrastructure and financial capabilities are lower while the role of informal community institutions is stronger. Our holistic approach towards going digital focuses on bringing low-income individuals from poor households onto the formal banking system, promoting active bank usage and providing handholding support to early adopters of digital payment solutions.

Our initial months were geared towards bringing low-income individuals from ultra-poor households onto the formal banking system and promoting active banking among them. By June 2018, along with our account opening implementing partner FIA Technology Partners, we had facilitated several account opening camps and opened accounts of 619 individuals. Since August 2018, we began the process of converting these account holders to users of digital payments and solutions.


We called 619 account holders whose bank accounts were opened prior to June 2018 with objectives to understand account holders’ access to debit cards and smartphones. Our hypotheses as of August 2018 were that all 619 account holders should have received their debit cards; they should have generated the ATM PIN; and their bank-registered mobile number should have been active.

The study indicated only 22% of account holders had a PIN generated ATM card; 27% had received the ATM card but not generated a PIN; 25% had not received their ATM card; and 27% had already changed their mobile number and we were not able to reach them despite multiple attempts.

The above-mentioned results helped us divide our base into four tiers – each tier had account holders that were similar in specific ways as explained below.

Learning 1: Frequently changing mobile numbers have a significant impact on financial inclusion

We observed few trends in Bhatta Basti regarding usage of mobile numbers; mobile phone numbers are frequently changed due to network problems, insufficient funds in their mobile account and new plans offered by different service providers. For example, residents suggested some SIM cards did not have the ability to pick up mobile data signals in Bhatta Basti, hence, they upgraded to a better SIM card, which resulted in their receiving a new phone number

Implications: If a mobile number registered with the bank account is already changed prior to the arrival of the debit card, the account holder cannot generate a PIN unless he/she visits the bank branch to change/update his/her mobile number. Likewise, Unified Payment Interface (UPI) on-boarding is not possible for smartphone owners if his/her SIM card is not registered with the bank account as he/she cannot receive interoperable OTP (Onetime Password) to activate the UPI account.

Learning 2: Many zero balance account holders do not receive their debit card

At the time of the interview, 155 account holders (25%) reported not receiving their debit card.

They were either waiting for the card or they had not collected it from the Customer Service Point (CSP). Only 58 of them (37% of 155 account holders) reported enquiring with the CSP or nearby bank branch.

Implications: POS, online banking or UPI on-boarding is not possible without a debit card

Learning 3: Many are not aware of how to generate an atm pin despite having a debit card

Amongst these 619 account holders, 167 account holders (27%) reported not generating an ATM PIN despite collecting the card. When probed, 34% of these 167 account holders reported failure of the ATM machine when they tried to generate a PIN; 31% did not see value in generating a PIN due to lack of savings and fear of safety; and 29% were not aware of the procedure.

This result indicates that perceived risk, complexity, lack of knowledge and fear of safety and confidentiality are the major factors that discourage the use of ATMs.

Implications: Internet banking, ATM withdrawals, or any other digital transactions using a debit card are not possible without an ATM PIN.


We conducted qualitative interviews with eight to ten account holders from each tier. The interaction focused on their attitudes towards banking services, in particular, debit cards. Below are the highlights of the interviews, which helped us identify their outlook and plan distinct interventions for each tier.

Attitudes towards ATMs


After differentiating account holders by their behaviours and the drivers behind them, we took the action needed in response to a tier-based intervention instead of ‘one-size-fits-all’ approach.

We designed the following intervention model ensuring each tier was covered, nonetheless, our focus was to provide handholding support to Tier 1 account holders as they were proactive about adopting debit cards without any external support and had positive attitudes towards technology used in banking. Our goal was to discover ‘early adopters’ amongst them, who are excited by the possibilities of new ideas and new ways of doing digital transactions.

We adopted a one-to-one permission marketing strategy emphasizing on personalized interactions with 135 account holders. The prospect explicitly agreed in advance for the visit (they were provided with an option to opt-out at any point). Initial reaction was inspiring as three out of four account holders agreed to learn about UPI digital payment solutions from us.


  • High conversion rate because of high customer attention as message was customized and persuasive.
  • Helpful in identifying different use cases. For example, we learned that ability to instantly recharge mobile phone was the most attractive feature of UPI applications for many account holders.
  • Since we were interacting directly with account holders, apart from receiving a direct line of feedback from the account holders, we were able to track issues straightaway, which helped us address issues quickly. For example, other members of the household using the mobile number of the head of the household at the time of the account opening was found in many cases.

In such a case, if the head of the household wants to register for UPI linked with a particular bank, he is not allowed given that the bank record shows the same mobile number registered for multiple account holders. We recommended account holders visit the nearby bank branch and update their account with their new mobile number; and informed the banking agent to encourage residents of Bhatta Basti to provide unique mobile number for new bank accounts, if possible.

  • The approach was also effective in developing the relationship with identified innovators.


  • The process was labour intensive and had a high cost (five field staff for approximately 30 business days to visit 101 account holders).
  • The process was time consuming. On average, a field staff spent two hours introducing the features, convincing the account holders to use the applications, downloading and registering the UPI app. Since we focused on our list of 135 account holders only (and did not go off of the list), field staff had to take several visits to complete one on-boarding.
  • Direct approach was also perceived as inconvenient or obtrusive for some account holders due to cultural sensitivity. Our field team appeared at times that were inconvenient for female account holders. For example, when any account belonged to a woman or a young child, we had to wait for the head of the household to return home as their presence was mandatory because of the nature of the transaction-related conversation.


The task of getting new account holders on board for digital payment requires the highest degree of handholding support through the onboarding process. For example, less tech-savvy users struggle at different stages with the onboarding process of any UPI application and are tripped up by the jargon such as “UPI PIN”, “VPA”. Hence, there is a clear need for greater guidance and handholding through the on-boarding process and in helping an account holder make the first transaction. Nevertheless, providing handholding support to everyone is not possible.

Therefore, it is important to break down the market into specific, targetable segments. In our case, we used the account holders’ access to debit card and attitude towards banking technology as a basis for segmentation. The majority of (more than 75%) account holders did not have a PIN generated debit card; there were only 135 individuals who had collected their debit card and visited the nearby bank branch that is approximately 2 KM away to generate PIN on their own. Instead of targeting all 619 individuals, which would have been an expensive and ineffective exercise, we created a list of 135 tier 1 individuals and reached out to them, who reciprocated positively.

Our biggest learning from this exercise was such a mechanism allowed us to precisely identify early adopters of UPI applications and, we were able to contact them with specific needs. This was also the best way for us to use our resources more effectively and make better strategic marketing decisions to convert early adopters to influencers in the community. For example, our experience on UPI on-boarding (detailed information will be covered in subsequent learning notes) indicated that the early adopters have huge potential to act as ambassadors for other segments to drive adoption of digital payment solutions if provided with enough support and followed up regularly. With the early adopters, this segment has potential to act as ambassadors for other segments and this should be therefore considered as one of the most important factors to determine the usability and sustainability of making transactions digitally in a low-income community. We observed some early adopters were proactive about informing their friends about UPI applications in order to onboard them so that early adopters could take advantage of cashback offers offered by some of the financial service providers for referrals.


ACKNOWLEDGEMENTS: The author would like to thank Arbind Vishwakarma for his insights and operational support.

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