FINANCIAL INCLUSION:

A GLOBAL PERSPECTIVE
CHALLENGES & OPPORTUNITIES

Suresh Aaluri
Research Scholar
JNT University
Kakinada
Financial Inclusion (FI)
What is Financial Inclusion
Large segment of population remaining excluded from
formal payments system & financial markets when financial
market developing & globalizing the process of ensuring
access to financial services, timely and adequate credit
where needed by vulnerable groups such as weaker
sections and low income groups at an affordable cost
Financial Inclusion (FI)
FI essential for inclusive growth which is necessary for
sustainable overall economic growth In developed
economies, focus is on small population In developing
economies (India), focus is on majority excluded
Types of Financial Exclusion : (i) exclusion from
payment system : not having access to bank accounts (ii)
exclusion from formal credit markets leading to approaching
informal/ exploitative markets
Measures of Financial Inclusion
Common measure : % of adult population having bank a/c
By this standard, 50.5% have accounts While males had
an access rate of 54.7%, females had 46.3% remaining
unbanked

Financial Inclusion (FI)
Who are excluded
Marginal farmers landless labour self employed
unorganized sector urban slum dwellers migrants
ethnic minorities socially excluded groups senior citizens
women
Globally more than 2.5 billion people do not have a formal
account. In many countries in Africa, the Middle East, and
Southeast Asia, fewer than 1 in 5 adults have a bank
account
Financial Inclusion (FI)
Global challenges to financial inclusion:
Globally, the reason most frequently cited for not having a
formal account is the lack of enough money to have and use
one.
The next most commonly cited reason for not having an
account is that another family member already has an
account.
The other reasons reported (in order of importance) are
bank accounts being too expensive, excessive distance of
banks, lack of the necessary documentation, lack of trust in
banks, and religious reasons
KYC documentary proof of identity/ address
The Opportunity for Financial Inclusion

The global revolution in mobile communications, along
with rapid advances in digital payment systems, is
creating opportunities to connect poor households to
affordable and reliable financial tools through mobile phones
and other digital interfaces.










Conclusion

Financial inclusion would require technical
innovation and practical action to make it a reality.
It will require sacrifice on the part of service providers,
governments, regulators and private sector stakeholders to
make it a reality. The glad tiding is that such sacrifice will
promote an equitable, more humane, secure and safe
society to live in and this justifies the need to pay whatever
price it take to achieve the objective globally.













Thank You