financial inclusion not good


financial inclusion- not too good




  • Road map for Provision of Banking Services in Villages with Population below 2,000: In pursuance of the announcement made in the Monetary Policy Statement of April 2010, the roadmap to provide banking services in every village with a population above 2,000 was finalised by state level bankers’ committees (SLBCs). Under the roadmap, 74,414 villages with population above 2,000 were identified as unbanked, which were allocated to various banks, including regional rural banks (RRBs) for providing banking services by March 2012. Banks have covered 74,199 (99.7 per cent) of these unbanked villages. Now the challenge is to cover all the unbanked villages of the country.
  • Accordingly, It is proposed: To mandate SLBCs to prepare a roadmap covering all unbanked villages of population less than 2,000 and notionally allot these villages to banks for providing banking services in a time-bound manner in the near future.


  • Banks have to Play the Crucial Role .financial inclusion was part of trin­ity along with consumer protec­tion and financial literacy which would ensure financial stability. Still India needs to do a lot regarding the financial inclusiv­ity. With than half of Indians still living in “unbanked” regions they have to depend upon the local money lenders who exploit them heavily.
  • In this regard, the Deputy Governor of RBI Dr Chakrabarty had asked the banks to ensure transparency in pricing of financial products and rationalisation of charges. He also said the work on financial inclusion to make available basic amenities for the poor is still lack­ing in some parts of the country and efforts should be made to broad base the achievements. While excellent work (on financial inclusion) is being done in some pockets, in many other areas the progress is not satisfactory and there is a need to broad base the achievements. While each jurisdiction will perhaps evolve their own different delivery models, the banking fraternity needs to learn from each other and implement what is suitable in their context sans duplication of precious infrastructural last mile connectivity. Some progress has been achieved but a lot needs to be done.
  • Between March 2010 to March 2012, than 50 million basic banking accounts have been opened to take the total number of such accounts to than 100 million. “Financial Inclusion programmes should be implemented on commercial lines and not on a charity basis. It is important that banking with the poor is perceived and pursued as a sustainable and viable busi­ness model,” the Deputy Governor said. He said though these figures in isolation seem very impressive, yet, if one considers the task ahead, to provide access to 1.2 billion people in the country and to reach 6 lakh villages, it is a long way forward. Appropriate delivery models are vital for achieving financial inclusion, according to Dr K. C. Chakrabarty. The financial inclusion plans were being prepared by banks with Board approvals since 2010 under the directions from the apex bank. The three-year horizon up to March 2013 has been given to banks. And the RBI is closely monitoring the advance made in this domain. The target of covering villages with population of above 2,000 was achieved by March 2012. Now, the nation needs to work towards universal banking access and for the banks to make it a viable business proposition much than charity.



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