Financial Inclusion
Short Decription: Financial Inclusion is a term which is often used in Indian Banking industry and in manifestos and announcements of govt.and banks.
Question: What is Financial Inclusion?
Answer: Financial Inclusion is a process or concept formulated with an objective of providing financial products and services to every constituent of our society, especially economically backward people. This concept has been developed and implemented keeping in mind the mainstream banking service providers. This is because it was felt that burden of financial services to downtrodden and poor people has been made aprerogative of rural banks and cooperative banks, who are not the mainstream players. And if mainstream players are not involved in this initiative it would be the traditional quasi-banking establishments, who would again take undue benefit of this situation.
The Reserve Bank of India (RBI) constituted a committee under SH Khan to give recommendations on Financial Inclusion. On recommendations of this committee, RBI appealed to all commercial banks to come out with a no-frill bank account that would attract the downtrodden unbanked masses of the country for its simplicity of operations. However, financial inclusion as a formal banking policy was implemented from 2005 on recommendations of Kamlesh Chandra Chakrabarty committee’s report. After this report, the terms and conditions to open bank account by marginalised people were eased by banks.
Important features of Financial Inclusion
a) Financial inclusion means the process of availing a minimum set of financial and banking services to the people residing in the lowest ladder of social paradigm.
b) Financial inclusion presses upon including the mainstream banking and financial initiatives in this initiative.
c) Opening a bank account is the most popular and simple tool of attaining objectives of financial inclusion.
d) Financial inclusion is being promoted as an important tool to achieve the target of “sustainable growth”.
e) Mangalam village of Puducherry became the first village to achieve 100% financial inclusion.
Do You Like This? Please take 5 seconds to share with your firends.
