Financial Inclusion- News and Views - December 2014


December 2015


The financial inclusion landscape in India is set for some novel and positive changes ahead. In November, the RBI released final guidelines for two new types of banks – Payments Banks and Small Finance Banks - and the Bharat Bill Payment System. The final guidelines reflect the consultative process of the RBI that has taken feedback from various stakeholders into consideration.

The Guidelines for Licensing of "Payments Banks" open up banking to existing non-bank Pre-paid Payment Instrument (PPI) issuers, NBFCs, corporate Business Correspondents, mobile telephone companies, super-market chains, real sector cooperatives and public sector entities. Payments Banks can accept deposits, with a maximum balance limit of Rs. 100,000 per customer, provide remittance services and issue ATM/ debit cards. They are not allowed to issue credit cards or undertake lending activities, although they can become Business Correspondents of another bank. Payments Banks can also distribute "non-risk sharing simple financial products like mutual fund units and insurance products".

The Final Guidelines for implementation of Bharat Bill Payment System (BBPS) bring into play the Bharat Bill Payment System, a tiered structure with the National Payments Corporation of India (NPCI) at the head as the authorized Bharat Bill Payment Central Unit. The BBPS aims at providing the convenience of 'anytime anywhere' bill payment to customers. Anytime bill payment is currently available to only those with access to net banking and is also restricted to a few utilities, this facility will now be available for every Indian for all utilities through a network of agents, including existing bank branches, under the BBPS.

These changes will bring more players into the Indian banking and payments landscape; all three entities are being introduced for a more cost-effective delivery of services to those who are currently outside the formal system. Meanwhile the Pradhan Mantri Jan-Dhan Yojana has been chalking up impressive account opening numbers, crossing 8.3 crores by end-November, and continuous monitoring and reviews are essential to ensure that the mission does lead to meaningful inclusion. As Sakshi Chadha of MicroSave writes in this blog post, How Many Accounts Does A Man Have To Open To Be Financially Included?, there are three key recommendations for long term sustainability of this programme: a) Make transactions and account activity a measure of financial inclusion success immediately, inclusion targets have to go beyond mere account opening statistics, b) Set up systems for credit assessment of the financially excluded customer base and c) Make all G2P payments electronically, direct into bank accounts, thus providing transaction volume to the rural agents that currently struggle to break even; this needs to be accompanied by appropriate remuneration for BC firms and the front-line agents, as well as appropriate communication to the beneficiaries about using financial services.


Section I: Policy – the latest from India's policymakers

Saving Credit

Dr. Raghuram G. Rajan, Governor, Reserve Bank of India, November 25, 2014

Re-designing Regulatory Framework for NBFCs

Shri R. Gandhi, Deputy Governor, Reserve Bank of India, November 23, 2014

Emerging contours of Regulation and Supervision in the Indian Banking Sector

Shri S. S. Mundra, Deputy Governor, Reserve Bank of India, November 13, 2014


Life Cover under PMJDY - Guidlines

Scheme for incentivizing Bank Branches under PMJDY

Section II: News and Views Digest – the latest from India and abroad


Payments, small banks to ring in innovation

Cost-effective distribution key to financial inclusion

ItzCash to apply for Payments Bank licence, says MD Surya

100 new banks in 3-5 years? Don't rule it out with RBI's new payment, small bank norms

RBI's payment bank norms to deepen financial inclusion

5 crore Jan Dhan accounts outside Rs 1 lakh accident insurance ambit

Financial inclusion needs another model

RBI prohibits Airtel, Vodafone & Idea from using existing channels for payments banks business

Debashis Basu: A payment bank won't pay

Financial Inclusion: All Households in Kerala, Goa Get Bank Accounts

Jan Dhan Yojana: Why impressive numbers don't mean much to financial inclusion drive

NBFCs say RBI's new rules will work against financial inclusion, drive towards unscrupulous moneylenders

Pradhan Mantri Jan Dhan Yojana: Banks to do ward-wise survey to gauge extent of exclusion

Jan Dhan balance tops Rs 5,000 crore mark, nearly 7 crore accounts opened


Building Sound and Inclusive Financial Ecosystems through Mobile Money: Highlights from the 2014 Leadership Forum

Interoperability: the role of rules and standards

Four Mobile Money Trends from the IMF Financial Access Survey

Three Ways Financial Service Providers can Empower Customers

Leveraging telco data for predictive credit scorecards in mobile money: An Interview with Telenor

Market Readiness for Mobile Money Interoperability

Five Bright Ideas for Responsible Digital Finance

Mobile-based BanKo boosts financial inclusion in Manila

The Technology of Financial Inclusion in Africa

Debate: should financial inclusion be a development goal in its own right?

Section III: Research – surveys and studies on expanding access to financial services

Mobile money profitability: A digital ecosystem to drive healthy margins

Mireya Almazán and Nicolas Vonthron, GSMA, November 2014

Code of Conduct for Mobile Money Providers

GSMA, November 2014



Financial Inclusion Metrics-Part I

Policy Brief October, 2014

Financial Inclusion Metrics-Part II

Policy Brief October, 2014

Operationalising Payments Banks for Inclusion

Policy Brief August, 2014

In the media

Do we need banks for financial inclusion?, 17 October 2014

Column: Making PM Jan Dhan Yojana a game-changer

Financial Express, 01 September 2014

Will the new financial inclusion plan work?

Financial Express, 18 August 2014


RBI releases Final Guidelines for Payments Banks

New legislation in Colombia marks the shift from the bank-led model

Moving beyond remittances

Banks raise barriers to basic banking


Editor: Sumita Kale can be contacted at

The Indicus Centre for Financial Inclusion was launched in 2011 to distil and disseminate information on accelerating the poor’s access to high-quality financial services. The Centre is supported by the Bill & Melinda Gates Foundation.

© Indicus Centre for Financial Inclusion. All rights reserved. 30th November 2014


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