Less than 20% of rural households in India have access to formal credit mechanisms. Equally low are the numbers of people in both rural and semi-urban India who hold simple bank accounts. The vast majority are at the mercy of greedy local money lenders. ‘Inclusive Banking’ would be key to bringing them into organized and formal systems.

Banks and MFIs have been hampered by the high cost of delivery in servicing remote far-flung areas. Since saving sizes are small and the number of transactions per day even lower, it becomes unviable for banks to penetrate such areas by having branches. Even credit delivery through ATMs becomes a costly proposition due to its high capital costs.

Vortex Engineering Pvt. Ltd aims to provide solution through its low cost ATMs which would help banks to provide financial services to rural and semi urban India.

Vortex Engineering Pvt Ltd (Vortex) is engaged in the manufacture of low cost ATMs which would enable banks to break the outreach barrier. The capital cost of Vortex ATM is less than 1/8th of a conventional ATM, dropping transactions rates to less than 40 per day and therefore making it viable for financial institutions to focus on inclusiveness.

Company background

Mr. L. Kannan is the Promoter and Managing Director of the company. He is a mechanical engineer from the IIT, Madras. For almost a decade he was working with associations/NGOs involved in rural development. He founded Vortex in 2001 as an entity that would develop technologies appropriate to rural India. Prior to developing the ATM, Kannan had developed a micro-spinning unit that enables cotton yarn spinning at extremely small scales.

Product

Vortex ATM Features:

 Design rugged, capable of working in rural areas without air conditioning
 Cash dispenser capable of handling soiled/used currency notes, no need to replenish ATM with fresh notes regularly and therefore reduces operational hassles
 Biometric authentication (fingerprinting) to protect illiterate users of ATM
 Standard features & pads for inputting PIN no., secure chest etc
 Conforms to standard security standards
 Lends itself to be used in ways deemed appropriate, whether fixed or mobile, can be equipped with smart card readers, with sound signals etc
 Can be integrated with suitable connectivity platforms, whether VSAT, Wimax, WLL, CDMA etc

Impact Potential

 Mature markets, on average, have a cash dispenser for every 1000 people. By this standard, India has potential for about a million ATMs as compared to the 20-25,000 in existence today.
 This is not counting the potential this offers to MFI’s to increase their access points. The trickle down impact would be enormous