India does well on financial inclusion, granular data needed to identify and resolve specific issues


Two reports released recently, the Agent Network Accelerator Survey 2017 (MicroSave and Helix Institute of Digital Finance) and the CRISIL Inclusix, show that India’s financial inclusion mission has been quite successful in coverage, and usage of financial services has seen a significant rise over the past two years. It is crucial now for policy to be more cohesive and not send conflicting signals to service providers; the Finance Minister’s statement that financial inclusion goals are yet to be achieved, sets the government’s agenda quite unambiguously.

However despite strong representations by industry, the RBI has refused to extend the KYC compliance deadline for PrePaid Payment Instruments (PPIs) beyond the stipulated date, 28 February 2018 (See Mobile wallet firms grapple to get users to comply with KYC norms, Mint, March 3, 2018). The RBI also issued new norms for payments banks to use third parties for KYC verification, and not rely on KYC done by telecom companies (Mint, February 21, 2018). While better KYC compliance enables smooth inter-operability and reduces risk of fraud, the RBI needs to ensure that its regulatory requirements do not kill innovative digital payments solutions for low income customers.

There has been a string of regulatory announcements over the past few weeks. The inter-regulatory working group on fintech and digital banking set up by the RBI in 2016 released its report, recommending a “regulatory sandbox” to foster financial technology innovation in India and a standalone data protection law in the country. The Finance Ministry has set up the Steering Committee on fintech related issues, that will also focus on the use of fintech for encouraging financial inclusion of MSMEs. Last month, the Reserve Bank also introduced the Ombudsman Scheme for Non-Banking Financial Companies to bring about improved customer grievance redressal. Each of these is a small yet important step, which when taken together will achieve a lot, provided the momentum continues.

Even as all these reports come in, it is important to remember that innovation and new product launch make for a lengthy process and policy uncertainty or ambiguity tend to hinder the process. As suggested in the Indicus Policy Brief “Fostering Innovation For Financial Inclusion", January, 2018, a comprehensive time bound regulatory road map can be evolved and shared with the industry by the DFS.


• Fostering Innovation For Financial Inclusion – Indicus Policy Brief January, 2018
• Indicus Blog: Aadhaar and DBT update
• ICFI Blog: Banking beyond 2017
Pradhan Mantri Jan Dhan Yojana Progress Report


India is doing well on financial inclusion

India needs more financial inclusion: Arvind Subramanian

Women hold over 50% of Jan Dhan accounts

India Post Payments Bank will begin nationwide rollout in April

Aditya Birla Idea Payments Bank starts operations

Airtel Payments Bank reduces interest rates by 175 bps to 5.5%

Nearly 87 Crore Bank Accounts Linked To Aadhaar, Says Official

Myths Busted, New Evidence Generated: ANA India Wave II Study has a Lot to Tell – Stay Tuned

KYC Utilities and Beyond: Solutions for an AML/CFT Paradox?

Women’s Financial Inclusion: What the Gallup World Poll Tells Us

An Innovator’s Dilemma: Teaching Mobile Payments

Super Platforms in Africa: Not if, but When

Connecting the Dots: Interoperability and Technology


Jordanians and Syrian Refugees: Remittances and Financial Services Use, CGAP, February 2018
2017 State of the Industry report on Mobile Money,GSMA, February 2018
The Mobile Gender Gap Report 2018,GSMA, February 2018.


Editor: sumita@indicus.orgThe 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. ©Indicus Centre for Financial Inclusion. All rights reserved. 5thMarch 2018.

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