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- Dr. Toufic A. Choudhury* Background and Definition 1. It is well recognized that well-functioning financial systems are essential for economic development. Well-functioning financial systems are by definition efficient, allocating funds to their most productive uses. It also covers other vital purposes such as offering savings, payment, and risk management products to as large a set of participants as possible, seeking out and financing good growth opportunities wherever they may be. The policy makers, practitioners and researchers have so far emphasized efficiency and stability aspects of financial systems and ignored the broader access to financial services. However, the current development theories increasingly project the role of access to financial services, the lack of which is often the critical element underlying income inequality as well as slower growth. 2. Financial market imperfections that limit access to finance play an important role in perpetuating inequalities. If financial market frictions are not addressed, redistribution may have to be endlessly repeated, which could result in damaging disincentives to work and save. Not only that, sometimes financial exclusion can lead to social exclusion. In contrast, building inclusive financial systems focuses on equalizing opportunities. Hence addressing financial market imperfections that expand individual opportunities creates positive, not negative, incentive effects. 3. In its landmark research titled “Building Inclusive Financial Sector for Development” (2006), popularly known as the Blue Book, the United Nations (UN) had raised the basic question: “Why are so many bankable people unbanked?” “Who are bankable unbanked?” It is estimated that globally over two billion people are currently excluded from access to financial services. Financial Inclusion has become an issue of worldwide concern, relevant equally in economies of the under developed, developing and developed nations. Building an Inclusive Financial Sector has gained growing global recognition bringing to the fore the need for development strategies that touch all lives, instead of a select few.

* The paper writer is a faculty member of BIBM. The paper has been prepared for presentation in a seminar on Inclusive Financing organized by PKSF on the occasion of its 20th Anniversary and Development Fair 2010. The seminar will be held on November 09, 2010.


insurance. financial inclusion should therefore be viewed as availability of banking and payment services to the entire population without discrimination of any type. actively contribute to their development and protect themselves against economic shocks. payments. allowing them to better integrate into the economy of their countries. Creation and expansion of financial services targeted to poor and low-income populations can play a vital role in enhancing financial access. Why does Inclusive Financial Sector development matter? Access to a well – functioning financial system can economically and socially empower individuals. would provide access to credit for all “bankanble” people and firms. to insurance for all insurable people and firms and to savings and payment services for everyone. such as halving the proportion of people in the world who live in extreme poverty by 2015. As banking services are in the nature of public goods. Finally. loans. Rangarajan Committee On Financial Inclusion (RBI. 2008.those in which no segment of the population is excluded from accessing financial services – can contribute to attaining the goals contained in the United Nations Millennium Declaration. 5. An Inclusive Financial Sector. remittance facilities and financial counseling/advisory services by the formal financial system.4.” FINANCIAL INCLUSION Savings Bank Accounts Financial Inclusion Financial advice Insurance Payment and Remittance Affordable Credit Source: RBI. in particular poor people. the Blue Book says. Inclusive financial sectors. The various financial services include saving. 2008) has argued that an open and efficient society is always characterized by the unrestrained access to public goods and services. the Rangarajan Committee has defined financial inclusion as “delivery of banking services and credit at an affordable cost to the vast sections of disadvantaged and low income groups. 2 .

Inclusive finance VS Microfinance 7. making them financially literate. Building inclusive financial sectors includes but is not limited to strengthening micorfinance and MFIs. It involves educating people financially. So. While each of them plays an important role in inclusive finance. al (2010) argues that financial inclusion does not restrict itself to deposit and credit. Extent and Indicators of Financial Inclusion/Exclusion 8. This is also reflected in wording as the term “financial exclusion” is widely used in the context of developed countries whereas financial inclusion is more frequently applied in case of developing 3 . They include NGOs. for the purpose of this paper. Inclusive finance recognizes that a continuum of financial services providers work within their comparative advantages to serve poor and low-income people and micro and small enterprises. facilities provided by banks and the advantages of using the banking route. state-owned banks. we mean and measure financial inclusion only in the sense of banking inclusion as banks are the mainstay of financial systems of the developing countries like Bangladesh). It includes financial awareness. Many development practitioners and financial institutions believe that there is a paradigm shift from microfinance to inclusive finance – from supporting discrete microfinance institutions (MFIs) and initiatives to building inclusive financial sectors. Retail financial service providers that serve this market segment are increasingly more difficult to define with one common term. knowledge about banks and banking channels. private commercial banks. It is generally observed that the degree of financial exclusion in developed countries is much less than what is seen in the developing countries. non-bank financial institutions (such as finance companies and insurance companies) credit unions and credit and savings cooperatives. Microfinance has been defined as the provision of diverse financial services to poor and low-income people.6. Siddique. (However. et. inclusive financial sector is built upon financial literacy and financial capability on the part of the consumers and availability of suitable product and services on the part of the financial service providers. many of them could not be considered MFIs in the technical sense.

6 per cent of the population of 15 countries in the European Union had a bank account. Thus a count of the number of bank accounts gives an idea of the percentage of people who are aware of banking and what percentage still needs to be included. World Bank (2008) shows.000 people. availability of banking services. A World Bank study (2000) measured access to finance in terms of demographic branch penetration. Some other indicators. and degree of usage of banking services. demographic ATM penetration. This is why the most commonly used indicator has been the number of bank accounts (per 1000 people). 4 . One recent review of national surveys reported that 89. bank deposit as percentage of GDP etc.0 per cent. number of ATMs (per million/per thousand people). 9.countries. and in many countries less than one in five households does. geographic branch penetration. loan accounts per 1. which is built on separate indicators representing three dimensions namely banking penetration. Extent of financial inclusion can be assessed in a number of ways. However financial inclusion does not end with opening of bank accounts. have also been developed to capture the financial inclusion such as number of bank branches (per million/per thousand people). bank credit as percentage of GDP. and geographic ATM penetration.1 per cent in Denmark to 70. deposit accounts per 1000 people. And at least 40 percent of firms report that access to and cost of finance is an obstacle to their growth. What matters ultimately is the availability of banking services and access to finance by the mass people. An important measure of financial inclusion is to count the number of people who own a bank account. in most developing countries less than half the population has an account with a financial institution. about half the rate of large firms. with country proportions ranging from 99. Since a country’s position or rankings changes with the changes in indicators a comprehensive measure in the form of index was developed by Sarma (2008). The comparable figure of the United States was 91. Survey data on the access of firms to finance indicate that less than 20 percent of small firms use external finance.4 per cent in Italy. A person holding a bank account is considered to have elementary banking knowledge.

013 IFI Rank 1 7 10 12 14 29 34 42 43 44 45 54 55 5 . 2006.One recent compilation of available data for some developing countries is given below. In another study.5 44.406 0.104 0. M.360 0.097 0. United Nations.0 43.015 0.101 0.0 21.1 Source: Building Inclusive financial Sector Development.7 35.3 6.737 0.8 17.3 17.3 28.4 25.518 0. As is evident from the table that Bangladesh stands quite low in the list with a rank of 43 out of 55 countries.4 31. The following table shows the result for some selected countries. Table 1: Percentage of Population with a bank account Country (Location) Botswana Brazil (Urban) Colombia (Bogota) Djibouti Lesotho Mexico City Namibia South Africa Swaziland Tanzania Bangladesh India Pakistan Percentage with an Account 47.393 0.146 0.103 0. (2008). Table 2: Index of Financial Inclusion (IFI) – using data on three dimensions of financial inclusion (2004) Country Spain France Malaysia Singapore Thailand India Philippines Pakistan Bangladesh Argentina Mexico Uganda Madagascar Source: Sarma. availability of services and usage of services. an index of financial inclusion has been developed by Sarma (2008) for 55 countries including Bangladesh.0 39.0 24.166 0. The three dimensions included in that index are banking penetration. IFI 0.

Who are the Excluded? Usha Thorat (2007) opines.implies an absence of obstacles to the use of these services. branch timings. urban slum dwellers. for example. unsuitable products. whether the obstacles are price or non-price barriers. self-employed and unorganized sector enterprises. For promoting financial inclusion. 6 . From the supply side. in the Indian context. There are a variety of reasons for financial exclusion. low income/assets. All these result in higher transaction cost and lower profitability. Users of formal financial services Voluntary Self-exclusion Population No need Cultural / religious reasons not to use / indirect access Insufficient income / high risk Non-users of formal financial services Involuntary exclusion Discrimination Contractual / informational framework Price / product features Source: Finance for All? The World Bank. the ease of availability of informal credit sources makes these popular even if costlier. or involuntary. but are denied access to the same. landless inclusion . 11. and illiteracy act as barriers. 2008. social exclusion. From the demand side. the financially excluded sections largely comprise marginal farmers. we have to address the issue of exclusion of people who desire the use of financial services.Who are Excluded and Why? 10. lack of awareness. It is important to distinguish between access to . On the other hand.and actual use of financial services. staff attitudes are common reasons for exclusion. 12. cumbersome documentation and procedures. bar access. Access to financial services . where price barriers or discrimination. where a person or business has access to services but no need to use them. Exclusion can be voluntary. distance from the branch. Failure to make this distinction can complicate efforts to define and measure access. oral lessees.the possibility to use .

United States of America: In USA between 9.. The concept of a savings gateway has been piloted. The CRA imposes an affirmative and continuing obligations on banks to serve the needs for credit and banking services of all the communities in which they are chartered. In fact. While there are pockets of large excluded population in urban areas. numerous studies conducted by Federal Reserve and Harvard University demonstrated that CRA lending is a win-win proposition and profitable to banks. the rural areas contain most of the financially excluded population. The Financial Inclusion Task Force in UK has identified three priority areas for the purpose of financial inclusion. According to HM Treasury estimate.migrants.5% and 20% of households lack a bank account. with the objective of making available the low cost banking services to consumers. Most important. A civil rights law. the State of New York Banking Department. viz. namely Community Reinvestment Act (CRA) in the United States prohibits discrimination by banks against low and moderate income neighborhoods. This offers those on low-income employment £1 from the state for every £1 they invest.K. It may be worthwhile to have a look at the international experience in tackling the problem of financial exclusion. United Kingdom: In U. senior citizens and women. financial exclusion is concentrated in certain geographical areas. ethnic minorities and socially excluded groups. Basic bank no frills accounts have been introduced. Around 22% of low income families do not have either a current or savings accounts. (appendix – 1). UK has established a Financial Inclusion Fund to promote financial inclusion and assigned responsibility to banks and credit unions in removing financial exclusion. up to a maximum of £25 per month. A Post Office Card Account (POCA) has been created for those who are unable or unwilling to access a basic bank account. the Community Finance Learning Initiatives (CFLIs) were also introduced with a view to promoting basic financial literacy among housing association tenants. International Experiences 13. access to banking. access to affordable credit and access to free face-to face money advice. the country has a relatively high number of households and individuals of 12% without bank accounts. In addition. Apart form the CRA experiment. the British Bankers’ Association has developed a concrete guideline which banks consider and implement while addressing the problem of financial exclusion according to their own business models. 7 .

e. which is in the nature of low cost account with minimum facilities. the banking industry endorsed a joint recommendation entitled “Current Accounts for Everyone”. charge per periodic cycle for use of such account. 41 percent of the population is unbanked. legislation entitled “Access to Basic Banking Services Regulation” was introduced in the country to ensure that all Canadians could obtain personal bank accounts without difficulty. Canada: In 2003.5 percent against 14 percent in 8 . French banks signed a charter committing them to opening a bank account at an affordable cost with related payment facilities. during 1995. In rural areas. Financial institutions are required to open personal bank accounts as well as cash most Government cheques at no charge (even to noncustomers) for any individual that meets basic requirements. in 1992. the coverage is 39 percent against 60 percent in urban areas.made mandatory that each banking institution shall offer basic banking account and in case of credit unions the basic share draft account. In addition. In rural areas. France: The 1984 Banking Act made access to a bank account a legal right in France. maximum number of withdrawal transactions without any additional charge and other charges imposed on transactions for availing electronic facility not operated by the account holder’s banking institution. undertaking to provide current accounts on demand. which will nominate an institution to provide the bank account. There have been two reports (1996 and 2000) on the effects of this voluntary undertaking. The Federal Government also introduced legislation-requiring banks to offer a standard low cost bank account with a basket of services. The results have so far been positive. the banking institution should. the initial deposit amount required to open the account. Any person refused a bank account can apply to the Bank of France. India: On all India basis 59 percent of the adult population in the country have bank accounts – in other words. furnish a written disclosure to the account holder describing the main features of the scheme i. The extent of exclusion from credit markets is much more. the coverage is 9. as number of loan accounts constituted only 14 percent of adult population. Germany: In Germany. minimum balance to be maintained.e. An interesting feature of basic banking account scheme is the element of transparency i. prior to opening the account.

covering life disability and health cover. microfinance institutions (other than Non-Banking Financial Companies) and other civil society organisations as intermediaries in providing financial and banking services through the use of business facilitator and business correspondent (BC) models. 25. In order to ensure that persons belonging to low income group. Adoption of Districts for 100% Financial Inclusion (i) The State Level Bankers Committee (SLBC) identifies one district for 100% financial inclusion. These are: No-Frills Accounts and General Purpose Credit Cards (i) In November 2005.000/. Bank staff or their agents who are usually local NGOs or village volunteers contact the households at their doorstep. The Reserve Bank of India has undertaken a number of measures for attracting the financially excluded population into the structured financial system. (ii) Use of Intermediaries as Agents in Microfinance (i) The Reserve Bank permitted banks to utilise the services of non-governmental organizations (NGOs/SHGs).at their rural and semi urban branches. the limits are sanctioned without insistence on security or purpose. 9 . The simplified procedure allows introduction by a customer on whom full KYC drill has been followed (ii) (iii) Banks have been asked to consider introduction of a General Purpose Credit Card (GCC) facility up to Rs. Responsibility is given to the banks in the area for ensuring that all those who wanted to have a bank account are provided with one by allocating the villages among the different banks. in association with insurance companies. banks were advised to make available a basic banking ‘nofrills’ account with low or nil minimum balances as well as charges to expand the outreach of such accounts to vast sections of the population.urban areas. innovative insurance policies at affordable cost. Based on assessment of household cash flows. the know your customer (KYC) procedure for opening accounts has been simplified. both in urban and rural areas do not encounter difficulties in opening bank accounts. In some cases banks have provided. The credit facility is in the nature of revolving credit entitling the holder to withdraw up to the limit sanctioned.

According to the Governor. 2010 and at the Bangladesh Economic Association Bi-annual conference held at Dhaka on April. Bangladesh Bank in his Joesph Mubiru Memorial Lecture (held at the Central Bank of Uganda on November 20. which have their photographs and finger impressions. we are looking at the majority who are excluded. registered co-operatives). “Financial Inclusion is a high Policy Priority in Bangladesh. money transfer and insurance services. the focus is on the relatively small share of population not having access to banks or the formal payment system. financial inclusion is reckoned in Bangladesh as access to financial services from: a) Officially regulated and supervised entities (banks and financial institutions licensed by Bangladesh Bank. (ii) Financial Literacy and Credit Counseling (i) Each SLBC convener has been asked to set up a credit-counseling center in one district as a pilot and extend it to all other districts in due course. Dr. Atiur Rahman. October – December. Whereas in Bangladesh. A Centre for Financial Education & Excellence has been set up in RBI’s College of Agricultural Banking at Pune. (ii) Bangladesh Scenario: 14. national savings bureaus). Account holders are issued smart cards. and b) Official entities themselves (post offices offering savings. 2009) has reiterated. 2009)*. 2010 10 . The approach to Financial Inclusion in developing countries such as Bangladesh is somewhat different from the developed countries. MFIs licensed by the Micro-credit Regulatory Authority. * Interested readers may also consult the deliberations given by the Governor. Bangladesh Bank at the FT Sustainable Banking Conference held at London on June 03. In case of developed countries. Mobile phones have also been developed to serve as card readers. for faster and more inclusive growth (Bangladesh Bank Quarterly. in view of no widely adopted uniform definition. Governor. In this regard.Use of ICT Solutions for Enhancing Outreach of Banks (i) The Reserve Bank has been encouraging the use of ICT solutions by banks for enhancing their outreach with the help of their Business Correspondents (BCs).

10 30. In spite 11 . Atiur Rahman (2009).78 42.46 26.84 66.76 7.16 75.36 7.52 24.60 84. In terms of banking credit related indicators also. is still outside the coverage of the formal banking system and is therefore. For example.40 30.30 31.02 43. Source: Dr.44 9.92 8.64 9.95 85.33 76. about 25 percent of adult population is still financially excluded. Post offices and government savings bureaus not included as these offer no credit services.68 9.65 7.37 9.67 7.50 35. in Bangladesh.82 22.30 28. In terms of above table.45 9.11 17.45 9.78 18669 18347 19886 20753 21406 21443 21420 21171 20920 20566 27. of members in cooperatives)/Adult population]*100.42 39.80 82. the state of financial inclusion is not encouraging.63 14.10 34. of MFI members + No.90 31.50 40.04 Notes: * Adult population is defined by BBS as population 15 years and above ** Financial Inclusion is measured here as – [(No.03 8.59 80.82 38.95 24. specially in rural areas.32 37.60 37.36 71.43 9.91 9. despite substantial bank branch expansion and increase of membership of MFIs and other institutions. it has been made mandatory that one in five branches must be in rural areas to encourage bank business there.40 18. In FY09 the share of agriculture sector in GDP was 22 percent whereas the share of advances in total advances to this sector stood at 7 percent as of June 2009. as reproduced below: Table 3: Status of Financial Inclusion in Bangladesh Adult Year Population* (millions) Population per bank branch (millions) Number of bank deposit A/Cs (millions) Deposit A/Cs as % of adult population Number of members in MFIs MFI members as % of adult Number of Cooperative members in members as cooperatives % of adult (millions) population Financial Inclusion** as % of adult population (millions) population 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 73. A substantial proportion of the households.21 65.41 77.73 38.22 8. the access of people involved in agriculture who mostly live in rural areas to banking services is not sufficient with respect to their contribution to GDP. of bank deposit A/Cs + No. unable to access mainstream financial products such as bank accounts and low cost loans.22 78.83 20.60 33.57 7.The current status of financial inclusion has also been presented in the Governor’s lecture.70 37.79 39.90 18.80 84.51 22.25 83. In terms of opening bank branches.00 38.18 79.83 14.89 20.16 77.

any farmer showing his/her National Identity Card/Birth Registration Certificate and Agriculture Inputs Assistance Card issued by the Agriculture Extension Department can open a bank account by keeping only 10 taka as initial deposit and banks do not require filling the Know Your Customer (KYC) form for this purpose. Along with moral suasion. extension of the loan period. Banks. 12 . A summary of such regulations is presented below. One such arrangement has been made in the last year for 'Aila' affected farmers. BB has issued license to all those centers as "SME/Agricultural Branch". some of which are very innovative for our banking system. BB responds to these types of situations by relaxing the conditions of loan repayment e.of the existence of 58 percent of total bank branches in rural area. for this purpose are directed to designate an official as 'Focal Point' at each branch of a bank. The regulation states that at least 50% of deposit of all these branches must be invested in SME/Agriculture sector and these branches must be set up in such areas outside the divisional cities and upazilas where no banking service is available. a number of policy measures covering both deposit and credit products. ii) To provide all range of banking services through SME service center and to ensure smooth and increasing amount of credit flow in the priority sectors like SME and Agriculture. have been taken in this regard. iv) Natural calamities and disaster affect our agricultural production including crop sector very badly and have become a regular phenomenon.g. No condition of maintaining a minimum balance will be applicable in this regard and also these accounts will remain free of any additional charge or fees. availability of fresh facilities for the farmers. Policy Environment for Inclusive Banking: Recent Measures 15. especially by including the disadvantaged section of the society in the formal financial system. As per regulations. i) BB is' making a big effort in increasing availability of the highest quality banking services to the farmer. iii) Easy and effective access to banking service for physically incapable people has been made mandatory by the BB through a recently issued circular. BB has taken strong initiatives in recent times to widen the coverage of banking services. the shares of rural bank branches in total deposits and advances were 13 percent and 8 percent respectively as of June 2009 which indicates a very low exposure of rural people to the formal banking system.

Documentation process has to be made as simple as possible and credit approval power shall be delegated to the respective branch manager. a number of refinancing schemes. A detailed guideline has been issued by the BB to facilitate agricultural credit for the farmers identified as sharecroppers. mobile phone and smart card technology platforms for innovating cost effective financial services packages for various client segments. To this end. Funds from IDA and ADB. BB gives emphasis on developing women entrepreneurship. viii) In order to ensure a smooth and increasing flow of credit towards the priority sector. MFIs. farmers engaged in successive crop production will avail credit facility without requiring redocumentation. Three such refinancing schemes are built up for SME sector. Under this system. 13 .v) BB has introduced a 3 years term revolving crop credit limit system to ensure smooth and continuous flow of agricultural credit. A detailed set of operational procedures for financing women entrepreneurs has also been effected. remittance and payment services. x) In the recent past. building up general financial literacy and awareness against money laundering and illegal hundi channels in remittance delivery. vii) One of the most innovative steps taken by BB in recent times is the provision of agricultural credit for the sharecroppers. Banks having no rural branch will disburse agricultural credit through linkage program with NGOs /MFIs. These are refinancing scheme of BB. Further. As per this regulation. each bank will have to allocate a certain percentage of its total loan portfolio for disbursing in agricultural sector at the beginning of every financial year and each bank has to inform BB its targeted amount of rural credit. BB has been urging banks and financial institutions to embrace specific commitment to financial inclusion as a CSR obligation. providing information and receiving feedback about deposit. Target by the banks in this regard must be realistic and implementable and must be regularly monitored by the banks. are being operated in our country. lending. vi) BB has made participation in agricultural/rural program mandatory for all the commercial banks including PCBs and FCBs. ix) Bangladesh Bank is encouraging creative partnership between banks. some of which are managed by the BB. Bangladesh Bank organized a cross country banking sector road show to connect and interact with the general people. 15% of all three refinancing fund have been allocated for the women entrepreneurs involved in SME business.

iii) Banking approaches to the financially excluded people are to be changed. which in turn can lead to greater financial inclusion. For example. iv) v) Women focus of the inclusive banking measures must be maintained. shows that many “basic” bank account holders go on to buy other products. Concluding Remarks The policies and measures which have been undertaken so far in Bangladesh in the context of inclusive banking are of course essential and in the right directions and have already started creating positive impacts. The Financial Inclusion Task-force data of U. there are some other issues which should also be taken into consideration for effectively addressing the challenges for ensuring sustainable inclusive banking in the country. but these are absent in the Bangladesh context. rather than customers coming to them. ii) The measures so far taken are still not fully able to address the demand side problems of the financially excluded sections of the population. these accounts are expected to play a key role in stimulating demand for other financial products. banks should go to the public. Toynbee Hall Research (2008) showed that some 25% of “basic” bank account holders had gone on to take up another financial product. without which sustainability of inclusive banking cannot be established. Financial exclusion is not only a supply – side problem. Here. These are not really spontaneous initiatives on the part of banks and financial institutions. with at least one in five opening of savings accounts. government owned commercial and specialized banks have so far opened 90 lakh 10 Taka farmers’ accounts. It is obvious that opening of these accounts will help our government to migrate from paper based payments of state benefits (which is really very timeconsuming and sometimes inhuman on the part of beneficiaries) to direct payment into accounts. Therefore.16. Other than farmers’ account. 2008..K. Ultimately. by this time. Not 14 . These are: i) The inclusive banking measures are fully regulatory driven. keeping all those farmers’ accounts “operational/active” poses a great challenge for the banking community and regulator of the country. Initiatives in regard to financial literacy and establishment of credit – counseling centres are very necessary. In the context of Bangladesh also. it is expected that these farmers account can facilitate a transaction to higher level of financial transition.

“Promoting Financial Inclusion for Poverty Reduction with Inclusive Growth”. Report of the Committee on Financial Inclusion.” RBI Bulletin. “Financial Inclusion as tool for combating Poverty: Joesph Mubiru Memorial Lecture”. This subject matter (financial inclusion) should be incorporated as a key segment of the initial training received by frontline branch and other customer contact staff. References British Bankers’ Association and Toynbee Hall. Atiur.only for excluded people. Building Inclusive Financial Sector for Development. 2005. 2009. A World Bank Policy Research Report. vi) Like mandatory agriculture/rural finance programmes. “Financial Inclusion: The Next Chapter”. United Nations (UN). M. Atiur. Sarma. 2010.2008. A keynote presented in a workshop held at BIBM on April 11. et. Index of Financial Inclusion. V. Thorat. held at London on June 03. Reserve Bank of India. London. “Taking Banking Services to the Common Man – Financial Inclusion. “Financial Inclusion: The Indian Experience. 2010. Developing Inclusive Banking. Bangladesh Bank Governor’s input in the Financial Inclusion panel of the FT Sustainable Banking Conference. Indian Council for Research on International Economic Relations. Mandira. 2008. the central bank should provide a detailed guidelines of inclusive banking to all formal banks and financial institutions. 2008. Siddique. 15 . Bazlur Rahman Memorial Lecture delivered at BEA Bi-annual Conference on April. Leeladhar. 2010. Bangladesh Bank Quarterly. Finance for All. 2008. 2006. Usha. July – 2007. vii) Finally instead of giving piecemeal directives. al. Rahman. even the financial service providers should also undergo extensive and continuous training on financial inclusion.] Rahman.” RBI Bulletin. October – December. M. World Bank. “Financial Inclusion and Rural Banking: The Case of Bangladesh”. June. all banks operating in Bangladesh may be asked to participate in financial inclusion program for which the responsibility of different unbaked/underbanked districts/areas should be allocated among the banks on the basis of some rational criteria. Rahman. Atiur.

Appendix – 1 British Bankers’ Association Guidelines for Supporting Access to Banking The guidelines are primarily intended to be read by those developing policy within banks ad it is expected that the ideas they convey will be incorporated into banks’ internal policies and procedures where it is felt they will result in an improved experience for customers. but to provide starting points and ideas which banks can consider and implement according to their own business mode. 16 . • • • Staff should understand the causes and effects of financial exclusion and how this may affect customers and their finances Staff should be able to communicate effectively with those who are new to banking Bank policy and procedures should acknowledge and compensate for difficulties some customers may face in providing standard ID and AV and staff should be able to support customers to negotiate these barriers • • Staff should be able to recognize and take into account the needs that may arise from low levels of financial capability Staff should be aware of their local community and be able to signpost customers to appropriate sources of support The intention is not to produce uniformity.