Including Women in the Formal Financial System

Posted on September 28, 2017 by Sumita Kale

As per the Financial Inclusion Insights for India in 2016, access for women to banking services has increased from 46% in 2014 to 61% in 2016. While 59% of Indian women had registered with a bank in 2016, active use (using the account in the last 90 days) increased from 21% in 2014 to 35% in  2015 and dipped marginally to 33% in 2016. Moreover, only 4% of Indian women are actively using advanced financial transactions that includes activities other than basic cash-in, cash-out and person to-person transfers. Clearly more needs to be done to break gender barriers, that are inextricably linked with social issues. 

The survey by Grameen Foundation and JP Morgan, 'Decoding bank account usage by low income segments: Placing reality in digital ecosystem', was conducted in rural Uttar Pradesh and Delhi/NCR noted that nearly 48 per cent of women preferred depositing money in formal banks and 72 per cent in rural banking institutions. Interestingly, women who had their phone linked to bank accounts were found to be very proactive in seeking updates on bank account. The survey results show that on an average, 44% of men in rural areas and 60% in urban areas mentioned seeking updates beyond usual banking transactions such as withdrawals and deposits, while the figures were 57% and 66% respectively for women.

India has been marked as successful case study for Financial Services for the Poor in the report by Gates Foundation showcasing Goalkeepers: The stories behind the data - The Global Goals. An excerpt of the interview with Rohini Pande points to the slow but inexorable change ahead for women in India. 

Melinda Gates: What do you see that makes you most optimistic about the future?

Rohini Pande: Generational change. When you go to a bank in a village right now, the people you see outside are school kids. Adolescent girls are well-versed in the financial system. You hear the bank tellers complaining that they’re always putting in one rupee at a time, and the tellers really don’t want to do it, but they can’t say no.

For a comprehensive paper on the challenges involved in bringing women into the formal financial system, read the Indicus  Policy Brief June,2016  Closing the Gender Gap in Financial Inclusion -


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India's household finances - a comprehensive report

Posted on September 01, 2017 by Sumita Kale

The Reserve Bank of India released the report of the Household Finance Committee, which is available for comments from the public till September 15th, 2017. The report is comprehensive  as it analyses the distinctive features of Indian household balance sheets, looks at emerging trends and their impact on the household balance sheets, uncovers significant evidence for the underlying causes of the deviations between Indian household financial allocations and what might be considered to be more desirable financial allocation and behaviour and proposes some solutions.

A quick summary of the report can be read from Monika Halan's piece "Need supply side solutions to solve the household finance problem in India" (Mint, August 30th, 2017), the Hindu Business Line " Households should have a set of readily available financial products", (August 24th, 2017) and Moneylife, "Complicated paperwork and bureaucratic impediments affecting household savings: Report" (August 31, 2017)

The connect of the committee's findings with the need for a privacy law is set out by Rahul Matthan (Mint, August 3oth, 2017)

Coming on the third anniversary of the PMJDY, the analysis and recommendations made in the report are crucial for extending meaningful financial inclusion, as it shows how banks and other financial service providers need to reorient themselves towards a customer-centric approach -  there are clear and significant gains at micro and macro levels if the supply side gets it right. 


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