PROMOTION OF FINANCIAL INCLUSION

MONEY TO DISADVANTAGED AND LOW INCOME GROUP

FLOW Towards VISION 2020

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Financial Exclusion - Prateek Introduction to Financial inclusion - Prateek Why did they fail - Rohit Current status - Rohit Vision 2020 and the model Rohit Post office and Govt. can also help - Prateek

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FINANCIAL EXCLUSION
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In India, almost half the country is unbanked. Only 55 per cent of the population have deposit accounts and 9 per cent have credit accounts with banks.* Only a little less than 20% of the population has any kind of life insurance and 9.6% of the population has non life insurance coverage.* Just 13 per cent had debit cards and less than 2 percent had credit cards.**

* Financial Inclusion by K C Chakrabarty **http://www.pwc.com ( Publications-2010 India Financial Markets 2020) 1/11/2012

FINANCIAL EXCLUSION
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NSSO Survey gave that 51.4% of farmer households are financially excluded from both formal/informal sources.* 5.2% of Indias 650000 villages have a bank branch. 39% rural Indian adult have Bank A/c. There is a scope of lending 45000 Cr. to the villages.and only 3900 Cr. is lended. RRBs in India have increased from 8321 in 1969 to 68,282 in 2005 but average person per bank decreased from 64000 to 16000.*

* Bihari S.C, Financial Inclusion for Indian Scene (Article in SCMS Journal of Indian Management, July-Sep 2011)

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FINANCIAL INCLUSION
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Financial Inclusion is delivery of financial services at an affordable cost to the vast sections of the disadvantaged and the low- income groups.*
Financial Service sectors credit, savings, insurance and payments and remittances facility. Micro Credit programme by many NGOs has found fancy with the banking industry. No frill A/c introduced was also successful in past. RRBs and SHGs promoting the credit and other financial services. * Bihari S.C, Financial Inclusion for Indian Scene (Article in SCMS Journal of Indian Management, July-Sep 2011)
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FINANCIAL INCLUSION
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Why did We Fail? Absence of Banking Technology Absence of Reach and Coverage Absence of Viable Delivery Mechanism Not having a Business Model Rich have no compassion for poor How It can be improved. Focus on Inclusive Growth Banking Technology has arrived Realisation that Poor is bankable
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FINANCIAL INCLUSION-Current Status

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RBI has set up a commission (Khan Commission) in 2004 KYC (Know your Customer) norms were relaxed for people intending to open accounts with annual deposits of less than Rs. 50,000. General Credit Cards (GCC) were issued to the poor and the disadvantaged with a view to help them access easy credit. In January 2006, permission to commercial banks to make use of the services of (NGOs/SHGs), MFI and other civil society organizations as intermediaries for providing financial and banking services.
Commercial Banks(rural & semi-urban branches) - 68289 Regional Rural Banks(rural & semi-urban branches) 13,932 Primary Cooperatives 1.09 lakh Self Help Groups(SHGs) - 3.4 million NGO MFI - 1,000 MFI registered as Companies -20

Major Three Aspects Of Financial Inclusion' Make people to Access financial markets Access credit markets Learn financial matters (financial education )

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FINANCIAL INCLUSION VISION

2020
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Our Vision Can Be Futures Reality

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NGO/SHGs, MFI, Civil society Organisations through twin model.

Banking Facilitator - Use of intermediaries such as NGO/farmers, Clubs, cooperatives, Community based org. , IT enabled rural outlets of corporate entities, Post offices, Insurance agents, well functioning , Village Knowledge Centre , Agri Clinics, Krishi Vigyan Kendra. Banking Correspondent - Use of third party like NBFCs , Societies/Trust Acts, Cooperative Societies Act of States. Others Sources- Mobile devices, branchless connection, retail agents, a new technology i.e Near Field Communication and RFID chips to be attached with mobiles to be used for authentication and transactions. As Expected 200mn rural connections by 2013 from current 90mn
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FUTURE OF FINANCIAL INCLUSION-The Way Ahead

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Priority Sector lending norm of 18% advances to Agricultural farmers. 139 districts still face financial exclusion, 41% unbanked people. 83mn KCC for extending easy credit to the farmers. 5mn SHG groups having a business of Rs 40bn. Post Offices a major turnaround to focus on Financial Inclusion
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Future 2020- How Indian Post can HELP

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16Cr. people using Indian Post to save Rs 3,23,781Cr. And out of which only 16,789 have savings a/c.* Promotion of IPPN to facilitate and make POSB(Post Office Saving Bank A/c) To provide Satellite Branches. Mobile Banking which will merge Post Offices RRB,MFI,SHG together making a branchless network.
* www.indiapost.gov.in IndiaPostReport
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Future 2020-Through Govt. HELP

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Promotion of KCC and KVP through MGNREGA act and on Post Offices. FIF and FITF fund is promoted by NABARD. Creating National Rural Financial Inclusion Plan. Promotion Swarozgar Credit Card through Retail Agents. Every body say that future is in our Hands, but one hand can do nothingso integrate different hands to help GROW RURAL INDIA*
*By Prateek Rastogi
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T H A N K Y O U

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VISION 2020

Prateek Rastogi, Rohit Munka III MBA-I III MBA-J CUIM

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