Fin inclusion duty of the mainstream: Chakrabarty

Financial inclusion requires work by mainstream financial institutions, such as banks and cooperatives, said K C Chakrabarty, deputy governor of the Reserve Bank of India, here today.

“It’s not institutions like micro finance institutions (MFIs) which will make financial inclusion possible in the country. Rather, it’s the mainstream institutions,” he said on the sidelines of a financial inclusion programme arranged by Corporation Bank in Mallaohalli village, 50 km north of here.

Adding: “MFIs play a very important role as of now and they will continue to do so.”

RBI has already told banks they must provide basic banking services in all villages with a population of 2,000 and more by March, 2012. It is also planning to cover villages with a population of less than 2,000 in an integrated manner over the next three to five years.

“In the first phase, 72,000 villages will be covered. The remaining villages will be covered in the second phase of the programme,” he said.

Chakrabarty stressed the need to use technology in reaching out to ruralites. “Even after 40 years of nationalisation of banks, banking facilities have not reached even 50 per cent of the population. Only by leveraging technology can we bridge this gap,” he said. “We should ensure that every person has a bank account, so that he can avail various financial services offered by the government and other agencies.”