RBI to bring out an index to gauge extent of financial inclusion
The Reserve Bank of India (RBI) on Wednesday announced that it will bring out an index that will gauge the extent of financial inclusion in the country.
“Financial inclusion has been a thrust area for the government, the RBI and other regulators. The RBI proposes to construct and publish a Financial Inclusion Index (FI Index) based on multiple parameters. This will be published in July every year for the financial year ending previous March,’’ RBI governor Shaktikanta Das said.
He did not disclose details of such an index.
Over the past few years, the banking regulator has announced several measures to step up financial inclusion and reach the unbanked.
Last year, the RBI had released the National Strategy for Financial Inclusion for India 2019-2024. The report was prepared by the central bank under the aegis of the Financial Inclusion Advisory Committee and was also based on the inputs and suggestions from the Centre and other financial sector regulators.
It said that focus on last mile delivery has been one of the major thrust areas in various countries.
The report added that as the typical rural customer would not be willing to forego his or her day’s wage to visit a financial service provider, it is important that distance and time taken to visit the service provider does not act as a deterrent.
To achieve this, various countries have come up with policies to extend the receipt infrastructure including permitting formal financial institutions to engage services of agents and Business Correspondents (BCs). While the BCs have been able to reach out to the last mile customer, the issue of customer protection, providing suitable products, increasing financial awareness, having a proactive oversight over the activities of the agents and sustainability of the agent or the BC network are some of the areas which now require policy interventions, it had said.