RBI constitutes committee on financial inclusion

Committee's terms of reference will include to review existing policy of financial inclusion including supportive payment system

The Reserve Bank of India (RBI) has constituted a committee with the objective of working out a medium-term (five-year) measurable action plan for financial inclusion. The terms of reference will include reviewing the existing policy of financial inclusion, including supportive payment system and customer protection framework, taking into account the recommendations made by various committees set up earlier.

It will also study the cross-country experience in financial inclusion to identify key learnings, particularly in the area of technology-based delivery models, that could inform policies and practices. The committee will also suggest a monitorable medium-term plan for financial inclusion in terms of its various components like payments, deposit, credit, social security transfers, pension and insurance.

Deepak Mohanty, RBI executive director, will chair the committee. The job of the committee will also include articulating the underlying policy and institutional framework, covering consumer protection and financial literacy, as well as delivery mechanism of the financial inclusion, encompassing both households and small businesses, with particular emphasis on rural inclusion, including group-based credit delivery mechanisms.

As a step to scale up the expanse of financial inclusion, the government, in collaboration with banks, launched the Pradhan Mantri Jan Dhan Yojana in August last year. Banks had opened about 167.3 million accounts till July 8. The balance in those accounts was about Rs 20,000 crore. About 51.1 per cent of these accounts were zero-balance accounts.