The Reserve Bank of India has placed the report of the Committee on Medium-term Path on Financial Inclusion (Chairman:  Deepak Mohanty).

Objective

The Committee was constituted with the objective of working out a medium-term (five year) measurable action plan for financial inclusion.

About the Committee

The committee, chaired by Mohanty, consists of officials from public and private banks, officials from payment networks, a representative from the World Bank, a representative from the Bill and Melinda Gates Foundation and central bankers.

Committee’s Recommendations

• The committee has recommended that a unique biometric identifier such as the Aadhaar identity number should be linked to each individual credit account and the information shared with credit information companies.
• The committee has recommended the use of application-based mobile phones as points of sale for creating necessary infrastructure to support the large number of new accounts and cards issued under PMJDY.
• The committee has warned against taking the competence of business correspondents (BCs) for granted.
• The committee has recommended a graded system of certification of BCs, from basic to advanced training.
• The report also suggested to further step up financing of the MSE Sector a framework for movable collateral registry may be introduced.

Data

• The average number of branches per 100,000 population in India has jumped to 9.7 by June 2015, as compared with 7.2 in 2010.
• The compound annual growth rate (CAGR) in the number of savings bank accounts between 2006 and 2015 in rural and semi-urban areas has been 15.6% and 15.9%, respectively.
• The committee has noted that there has been a significant jump in financial inclusion-related activities in India after the introduction of the Prime Minister’s Jan Dhan Yojana (PMJDY) in August 2014.