The other stakeholders of ALW include Enam Financial, Bellweather Microfinance Fund, India Financial Inclusion Fund and Legatum Ventures, a Dubai-based private equity fund.
“SBI bought 20 per cent equity stake in ALW and henceforth we will undertake majority of work for SBI in future. Considering the enormous work that SBI plans to do undertake, there will be no time to work for other banks. At present, we have a tie-up with 24 other banks, they will be phased out gradually and while some may remain with us,” said a promoter of ALW and Zero Micro Finance and Support Foundation.
A senior SBI official said, “We bought the equity stake in the company for a consideration of Rs 80 crore so that company could speed up the financial inclusion exercise of the bank.”
This company was the first business correspondent (BC) in India. It became a BC for SBI in Mizoram in 2006 when the financial inclusion exercise was first rolled out to reach banking to the unbanked rural hinterland. The equity stake is expected to help SBI in its ambitious financial inclusion drive that is expected to reach 12,391 villages in the next two years through a network of 25,000 customer touch points.
The company has helped banks attain 60 lakh no-frills accounts through 10,000 microbranches which operate out of grocery shops or individuals. ALW has a track record of creating commercially viable and innovative technology solutions that have been hived off as separate entities after receiving investments form investors.