FINANCIAL INCLUSION

Recent activities
• Two private entities — ICICI Bank and HDFC —
took different approaches to growth. ICICI grew
more aggressively, taking advantage of the reforms,
and HDFC grew cautiously but steadily
• Market regulator Securities and Exchange Board of
India (Sebi) has launched a pogramme to take
financial education and inclusion forward. Sebi
plans to impart financial education and investments
skills among homemakers, self help groups, young
investors, retirees and even school children.
 Recent activities
• The globally acknowledged standard setting body for anti-money
laundering and the fight against terrorist financing, the Financial Action
Task Force (FATF) has only recently[1] acknowledged that financial
inclusion and financial integrity (i.e. the prevention of money
laundering and terrorist financing) are complementary public policy
aims.
• This has led to a new FATF work stream on financial inclusion which is
seeking views from the industry on how to best achieve these
complimentary policy aims.
• One major regulatory hurdle facing operators wishing to deploy mobile
money services is the disproportionate implementation of FATF rules
intended to prevent money laundering and terrorist financing. Whilst
these rules are necessary, they have not been designed for people living
at the bottom of the pyramid. They are often implemented in a
disproportionate way by national regulators, considerably impairing the
ease of use of mobile money services for unbanked customers.
 Recent activities
• Public sector banks are appointing business correspondents and
facilitators in the thousands. The government of India is planning to
ensure the availability of five financial products namely savings, micro-
credit, remittances, micro pension and micro insurance to folks living in
73,000 villages. Micro pension and micro insurance will be delivered
after the other three. UID will be used as a tool to enable the opening of
bank accounts for citizens as they enroll for it through partner banks.
With 600 million IDs expected to be issued over the course of the next
four years, that sounds promising.

• Mobile banking is getting a lot of attention with SBI signing up with

Airtel and ICICI Bank with Vodafone Essar. The goal is to offer
financial products through the mobile network which has a much
broader reach than the banking establishment today. Retailers who are
selling the telco's products will become financial correspondents. With
this, millions are expected to be brought into the banking net
 Recent activities
• Cloud computing is starting to catch on in the banking
sector with Indian Bank going for a cloud-based solution
from TCS around the latter's BaNCS platform. With this,
the bank expects to provide banking services to customers
in 5,500 villages. All in all, financial inclusion is going full
steam ahead.
• To bring muslims to the mianstream of our economy Islamic
Banking and, Shari’ah Indexes providing guidance and
accurate information about companies engaging in Shari’ah
compliant businesses will open way for the second largest
majority of the country to have their share in the current
financial system.
 Recent activities
• Many financial institutions are coming up
with initiatives to complement
Government’s efforts in empowering farmers
in rural areas with loans. One such
institution is the National Credit and Savings
Bank (NATSAVE), which has taken up the
challenge to partner with other stakeholders
and launched the Asset-plus loan initiative
in Mansa