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Another chapter in the report will chart the whole institutional structure of what are the channels, sources of fund
flow, how funds percolate down through different intermediaries to the poor and financially excluded. Some of the
specific discussion like models and means to reach the excluded will also be examined. Mr. Tankha also mentioned
about a section on technology and development of CBAs. He highlighted on capturing technology in RRB, coopera-
tives, banking channels and various challenges posed while implementing technology solutions. Another section will
look at regional disparity, demographic divide and what is the level of inclusion in certain packets or geographies. The
authors also disclosed their intention to conduct their own small set of study to find out the true picture on the ground.
He mentioned that the government has become very important player in financial inclusion. The government’s
initiatives related to Direct Benefit Transfer (DBT) and some of the initiatives taken in other states like MP will also
be examined. There are a lot of case studies and specific initiatives to embellish the report and he would welcome
suggestions from participants to further refine the structure. As suggested by Solution Exchange, UNDP in its presen-
tation, there are areas which we have not covered but plan to cover like Urban Microfinance, Cooperatives, Producer
Organisations and the role of states. He will try to cover these in a more significant way.
Dr. Tara Nair mentioned that about seven years have passed after Rangarajan Committee report came out and we
began the debate and discourse on doing Financial Inclusion in India. A lot has been done, a lot has changed. The
Government and RBI has shown certain path on evolution of Financial Inclusion. Some of these have worked while
some did not work. Some banks have done well while some have not. There have been some policies which have really
done well but in some other cases they have really been detrimental to the entire process. So the report may come at a
time when we seriously need to evaluate what has been happening over the past.
What is really missing in the process of inclusion is an atmosphere for cross learning from the experiences. People
have been working in organizations as islands. Bank level policies were neither talked nor discussed much amongst the
practitioners. This document may for first time create a platform for multiple perspectives and methodologies to speak
with each other and this could be one of the ultimate goal of this document other than just documenting the initiatives.
Analytically if some sort of cross learning happens system wide then the report can serve the purpose marginally.
Dr. Tara acknowledged that the understanding of financial inclusion has widened over the years, it started with
opening of Bank Account for every single individual later other kinds of financial services were added to it. We also
realized that it is not only rural problem but also an urban problem. If there are rural solutions then there has to be
urban solutions also. The component of enterprise activities also needs to be added to it because there is gradation of
exclusion with productive assets.
Presentation on the Study of Financial Capability-GIZ: Smita Premchander, Jaipal Singh and
Leonore Gruenberg
The GIZ initiative on financial capability looks beyond financial inclusion. Financial inclusion will actually be mean-
ingful if people use the money and account productively. GIZ conducted a study looking at how capable people are
in using their finances and came out with a report. The report analyses results from 96 Focus Group Discussions with
524 low-income people in 8 districts of Odisha, Uttarakhand, Rajasthan, and Karnataka. The objective of this study
was to understand the financial behavior of low income people by looking at their own perceptions as users of money
and financial services: How do people perceive money and financial services? What do they mean to them how do they
make their financial decisions? Which factors support or constraints their financial behavior and capability.
Based on the findings of the study GIZ defined Financial Capability as an ensemble of abilities that relates to making
of informed financial choices, managing money effectively and using financial services for one’s own benefit. Thirteen
abilities emerged from the study and based on these abilities a set of tools were developed for people to use it readily
and understand the abilities with help of games and stories. The development of tools was followed by seven road shows
to promote the concept. GIZ is now seeking partnership with organizations to take it ahead and also has plans to pilot
