RBI stresses on more efforts for financial inclusion

The Reserve Bank of India (RBI) has said that more efforts are needed for achieving financial inclusion and creating the spirit of entrepreneurship to make the economic growth success broad based.

Speaking here at a convocation ceremony of EDI Ahmedabad, RBI Deputy Governor KC Chakrabarty also called upon the NGOs to play a bigger role in this regard.

"While the growth story has been impressive, there are causes for concern on other dimensions. Issues of income distribution are important. We have a long way to go in addressing concerns of absolute poverty," he said.

Chakrabarty pointed out that India ranks 119th among 169 countries on the 2010 Human Development Index published annually by the United Nations Development Programme.

"We compare poorly on almost all indicators such as life expectancy, education and per capita income. We have issues of water, sanitation, power, infrastructure and environmental degradation. More importantly, there are issues of social and economic inequalities and multiple deprivations," he said.

The RBI deputy governor said that an inclusive growth is not possible without financial inclusion.

"Financial inclusion has become a major policy plank. RBI vision is that everyone in the country should have access to financial products and services but our immediate objective is that every village with a population exceeding 2,000 should be covered either by a bank branch or through a business correspondent by 2012," he said.

Such a situation will act as a source of empowerment and allow people to participate more effectively in the economic and social process, Chakrabarty added.

"Our dream of inclusive growth will not be complete until we create millions of micro-entrepreneurs across the country. All budding entrepreneurs have to face these challenges and find solutions," he said.

Regarding the role of NGOs, he said: "India today is home to the largest number of NGOs in the world. A recent government study estimates the number of NGOs at 3.3 million."

Chakrabarty said the people working in the social sector should work for filling up the deficit existing in the economic and social arena.

"We trust that some in our midst, who are stepping out to pursue a career in the social sector and become agents of social change, will not only fill in this deficit but will also pioneer new areas," he said.