RBI pushing financial inclusion on mission mode, says official

'RBI is pushing financial inclusion on mission mode'

A planned and structured approach has been followed to address the twin issues of demand and supply, RBI Regional Director Deepak Singhal said.

  • New Delhi,  September 29, 2014  
  • |  
  • UPDATED   17:12 IST
RBI pushing financial inclusion on mission mode: Official
(Photo: Reuters)

The Reserve Bank of India (RBI) is pushing the financial inclusion drive in a "mission mode" and has taken several steps including allowing banks to offer more products and have easier KYC (know-your-customer) norms, a top official said on Monday.

"We are furthering financial inclusion in a mission mode through a combination of strategies ranging from relaxation of KYC regulatory guidelines, provision of new products and supportive measures to achieve sustainable and scalable Financial Inclusion," said RBI Regional Director for New Delhi Deepak Singhal.

The central bank attaches great deal of value to financial inclusion.

A planned and structured approach has been followed to address the twin issues of demand and supply, Singhal said while chairing a session on Innovative Ways of Achieving Financial Inclusion, organised in the national capital by consultancy firm Dun & Bradstreet.

"We have framed regulations with an objective of providing banking services to over 6 lakh villages and to create an enabling environment for banks to do so by branch expansion, making it mandatory to open 25 per cent branches in rural areas," the regional director said.

He said RBI had been on the forefront of using technology to spread the financial inclusion drive, though enough was not happening on the financial literacy front.

"People who have access to banking services are not using banking services simply because they do not know how to use banks or they are not comfortable using it," he said.

Singhal said the RBI has also relaxed the KYC norms to open bank accounts under the Pradhan Mantri Jan Dhan Yojana by allowing acceptance of only one of the documents - proof of address or proof of identity.

"Two separate documents were required earlier but now there is clear instruction from RBI, that any one of the documents is necessary. The Aadhaar card is sufficient proof of identity even if the current address is changed."

On the Jan Dhan Yojana, State Bank of India (SBI) Deputy Managing Director, Retail Strategy, M G Vaidyan said the measures taken by the governmeny were yielding results. "Aadhaar was on the back burner for some time, but it has now become instrumental in the financial inclusion drive," said Viadyan.

Ambrish Shahi of Unique Identification Authority of India (UIAI) said that Aadhaar cards would help a large number of people access banking services easily.