India is a largely rural country with over 800 million residents living in rural areas. Despite the strides in connectivity and the availability of offline and online financial services, a large section of the rural populace faces multiple barriers to accessing financial services. Things are changing lately, with the emergence of new-age technologies such as Aadhar-enabled payment systems (which facilitate payments by authenticating an individual's biometrics) and a successful banking correspondent model, where intermediaries in rural pockets offer banking services.  

Arvind Kumar Das, a seven-year MDRT member from Kolkata, India, reckons the key to engage with rural communities for financial advisors is to understand their unique circumstances and challenges, including limited access to formal financial services, low literacy rates, and so on. Any engagement requires a multifaceted approach that can offer solutions to fix some of these challenges.  

Localized outreach and financial literacy  

It may seem like a pipedream, but financial literacy is the cornerstone of empowering rural communities. Financial advisors in rural areas must invest resources and time in localized outreach programs offering comprehensive financial education.  

Das shares, “I actively organize workshops, seminars, and training sessions conducted in local languages such as Hindi, Tamil, or Bengali. For instance, I recently hosted a workshop in Mumbai where I addressed the specific financial challenges faced by local residents. By tailoring the content to their cultural and linguistic preferences, I was able to effectively engage with attendees and provide them with practical insights to enhance their financial well-being. Additionally, I regularly collaborate with community organizations and local leaders to reach a wider audience and make a meaningful impact in their financial literacy journey." 

He adds, "It cuts through the jargon and makes challenging concepts like insurance more understandable. At a personal level, it helps me build good relationships. Moreover, educating them creates awareness about annuity and pension products. These products are helpful and boost the financial portfolio of daily wage workers as well." 

Technology adoption 

Technology is fast changing the financial landscape. In rural India, it ensures folks in remote locations can access cash and make transactions via mediums such as banking correspondents. It has made concepts such as QR codes, mobile banking facilities, and digital wallets available to consumers. It brings a large chunk of the population into the broader financial system. "Financial advisors should offer more details about these technological developments, explain how they work, and the major benefits they offer," Das quips.  

He argues that smartphones are a helpful tool for financial transactions in rural areas. The challenge, states Das, lies in assuring rural clients familiar with basic Unified Payments Interface (UPI) transactions to shift to financial services such as mobile banking and digital wallets. "Many are apprehensive about the security aspects of digital transactions. To fix this, advisors can showcase live examples within the community of how others have benefitted by using these tech tools. It will bring more people into the financial services ambit." 

Local collaborations  

Building partnerships with local institutions, such as cooperatives, self-help groups, and community organizations, is instrumental in a financial advisor's business journey. These entities serve as trusted intermediaries within rural communities and can facilitate the acceptance of financial services such as insurance. Das says, "These partnerships offer trust and credibility as local institutions are embedded and trusted in rural communities. Financial advisors can leverage existing credibility." 

To expand his outreach, Das partnered with local institutions like rural cooperative banks.. “For example, by collaborating with one such bank, I efficiently reached rural clients, offering them tailored financial advisory services. This partnership not only streamlined service delivery but also empowered the bank's staff to act as effective intermediaries, ultimately benefiting both parties. This way, I can establish networks that can emerge as clients for financial advisory services. It facilitates efficient outreach and service delivery, reducing the time and resources required to build a client portfolio in rural areas,” he says. 

Building a local connection   

Effective communication requires cultural sensitivity and language proficiency. Financial advisors must be well-versed in the local dialects and customs to establish trust and build meaningful relationships. Cultural understanding is crucial in tailoring financial advice and solutions to the specific needs of each community and 

language definitely plays an important part in building cultural understanding. "I am a native Hindi speaker and I also speak and understand multiple languages and dialects, including Bengali, Odia, Maithili, and Bhojpuri. It helps in crafting personal relationships," says Das.  

Building long-term relationships involves continuous support and regular follow-ups, periodic financial check-ins, and proactive problem-solving can demonstrate the advisor's commitment to the community's financial well-being.

Customized products and services 

Alongside local collaborations, Das emphasizes the importance of financial advisors developing customized financial products and services for their clients. From a rural perspective, this could include microfinance solutions, insurance products tailored to offset agricultural risks, and savings schemes aligned with agrarian cycles.  

Das offers some examples, "In rural India, many will not be able to afford a regular insurance product. Micro insurance schemes work best in these areas. In areas where agriculture is the mainstay, I aligned premium payments with the agricultural cycle, ensuring the customers could make premium payments on time and reap the benefits of the financial products." 

As India progresses towards greater financial inclusivity, the role of financial advisors in rural areas is pivotal in ensuring that no segment of society is left behind in the journey towards economic prosperity. 

  

 

Contact: MDRTeditorial@teamlewis.com