How can digital payments and business correspondents improve financial inclusion in a remote hill village in M

Exercises · Q12

Q. How can digital payments and business correspondents improve financial inclusion in a remote hill village in Manipur?

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In a remote hill village where a full branch is uneconomic, two drivers can still deliver inclusion.

Business correspondents (banking agents):

A local, authorised agent equipped with a hand-held or micro-ATM device provides basic banking — opening accounts, deposits, withdrawals, transfers — inside the village.
This removes the need for villagers to travel long distances over difficult terrain to reach a branch.
The agent can also help deliver direct benefit transfers and support SHG transactions.

Digital payments:

Mobile and app-based payments and RuPay debit cards let villagers pay, receive wages and transfer money without cash or a branch visit.
They ‘leap over’ the distance problem — provided network and electricity are available, which is itself a challenge in interior hill areas. …

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Same / Similar Concept — real previous-year questions on the same or a closely similar concept, not this exact question.

COHSEM Manipur Higher Secondary 1st Year (Commerce) 2025Set ANNUAL1 markMCQ
$Q. In the following question, a statement of Assertion (A) is followed by a statement Reason(R). Choose the correct alternative among those given below : (A) Both Assertion(A) and Reason(R) are true and Reason(R) is the correct explanation of Assertion(A) (B) Both Assertion(A) and Reason(R) are true and Reason(R) is not the correct explanation of Assertion(A) (C) Assertion(A) is true but Reason(R) is false (D) Assertion(A) is false but Reason(R) is true Assertion(A) : A Self Help Group is a financial intermediary committee usually composed of 10 to 20 local women. Reason(R) : Self Help Groups empowers the saving habits especially of rural women.$
›Reveal solutionSolution

A is true, R is true, but R does not explain A.

Assertion (A) is correct: a Self Help Group (SHG) is indeed a voluntary financial intermediary/informal association, typically composed of 10 to 20 local women (or men) from similar socio-economic backgrounds, who come together to pool small savings regularly and extend credit to members.

Reason (R) is also correct as a general statement: SHGs do empower the saving habit, especially among rural women, by encouraging regular small deposits and building financial discipline and confidence.

…

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COHSEM Manipur Higher Secondary 1st Year (Commerce) 2024Set ANNUAL1 mark
$Q. Suggest one banking service to improve the financial literacy and payment mechanisms to rural households in Manipur.$
›Reveal solutionSolution

Expanding the Business Correspondent (Bank Mitra) model — doorstep banking agents who also train villagers in using mobile/UPI-based digital payments — is a concrete, practical banking service to raise rural financial literacy and strengthen payment access in Manipur.

Many rural households in Manipur's hilly and remote areas lack easy physical access to bank branches, and many account-holders remain unfamiliar with digital payment tools. A Business Correspondent (Bank Mitra) posted in or visiting each village can (i) help households open and operate basic (BSBDA/Jan Dhan-type) accounts, (ii) conduct simple on-the-spot demonstrations of mobile banking, UPI and ATM/debit card use so households become comfortable with digital payment mechanisms, and (iii) explain savings, credit and insurance products in the local language. This single service — doorstep banking combined with hands-on digi …

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Q.How can digital payments and business correspondents improve financial inclusion in a remote hill village in Manipur?

Concept understanding — Drivers of Financial Inclusion in India

Q.How can digital payments and business correspondents improve financial inclusion in a remote hill village in Manipur?

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