PayNearby Introduces Dual-Authentication System for SHG Cash Transactions
PayNearby has introduced a dual-authentication system for Self-Help Group cash transactions, enabling digital withdrawals and deposits through its network and Digital Naari platform. The service eliminates traditional banking constraints requiring physical presence of two signatories, potentially benefiting one crore SHG members. The initiative focuses on improving financial inclusion for women-led groups in rural areas while maintaining compliance and transparency standards.
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PayNearby has launched a dual-authentication-based system to enable digital cash withdrawals and deposits for Self-Help Groups (SHGs), marking a significant advancement in digitising SHG-bank transactions at the grassroots level. The service has been implemented across PayNearby's network and its Digital Naari platform, allowing SHG members to conduct cash-in and cash-out transactions within their local communities.
Service Implementation and Reach
The new system addresses traditional banking constraints by eliminating the need for repeated visits to bank branches. According to PayNearby, the initiative has the potential to benefit up to one crore SHG members across the country.
| Parameter: | Details |
|---|---|
| Target Beneficiaries: | Up to 1 crore SHG members |
| Platform Coverage: | PayNearby network and Digital Naari platform |
| Service Type: | Cash-in and cash-out transactions |
| Primary Focus: | Community-level banking services |
Addressing Traditional Banking Challenges
Traditionally, SHG withdrawals require the physical presence of two authorised signatories at bank branches, creating operational bottlenecks. This process often leads to significant delays and higher transaction costs for SHG members. These constraints have resulted in several cases where funds remain unused or are held informally, directly affecting the timely deployment of resources for livelihood and micro-enterprise activities.
Dual Authentication Mechanism
PayNearby's system introduces dual authentication to digitise SHG transactions while maintaining regulatory compliance and auditability standards. The mechanism is specifically designed to improve transparency and enhance risk management in SHG fund access procedures.
Key features of the system include:
- Digital authentication replacing physical signatory requirements
- Enhanced transparency in transaction processing
- Improved risk management protocols
- Maintained compliance with regulatory standards
- Comprehensive auditability of all transactions
Impact on Financial Inclusion
The initiative enables SHG members, particularly women, to withdraw or deposit cash closer to their homes, significantly reducing travel time and associated costs. This development aligns with broader national efforts to strengthen financial inclusion and improve access to formal financial services at the grassroots level.
The system particularly focuses on supporting women-led groups in rural areas, where access to traditional banking infrastructure remains limited. By bringing banking services directly to communities, the platform addresses critical gaps in rural financial service delivery.
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