i nc lu s i ve f i nanc e i nd i a re port 2014
18
NOTES
1. See Srinivasan (2011), Chapter 9 and Puhazhendhi (2012),
Chapter 4 and Nair and Tankha (2013), Chapter 5.
2. Definition of financial inclusion as contained in
The Global
Financial Development Report 2014
(GFDR 2014) of the
World Bank.
3. Aynsley (2010).
4.
/
from-credit-to-inclusive-finance
5.
/
6.
-
MFP_Summer_2012_p6p7.pdf
7. Rajan (2014a).
8. For example, the GFDR 2014 asserts that a diverse and com-
petitive financial sector—one that includes different types
of financial providers and financial markets—is helpful in
supplying the range of products and services necessary for
healthy financial inclusion.
9. See, for example, Chakrabarty (2014).
10. Annual Policy Statement for the Year 2005–06 by Y.
Venugopal Reddy, Governor, Reserve Bank of India.
11. See
Business Standard
(27 July 2014).
12. Several studies in India have shown that measures such as
the opening of no-frills accounts (NFAs) (later designated
as basic savings bank deposit accounts (BSBDAs) have
been largely ineffective. The vast majority of such accounts
have remained inoperative with estimates of dormancy go-
ing up to 80 per cent of total. It remains to be seen how
effective will be the new thrust on opening of accounts
under the Pradhan Mantri Jan-Dhan Yojana even as they
are supplemented with important and necessary financial
products such as debit cards, overdrafts and life and health
insurance that had earlier been envisaged by the Rangarajan
Committee.
13. Barcus (2011).
14. The financial capability concept goes beyond that of financial
literacy. It asks which knowledge, skills, and attitudes do
people have to make informed choices regarding the use and
management of money as well as how external factors such as
access to financial products and the conditions to use them
influence these choices. It also asks how personal attributes
and environmental factors can be changed to increase the
ability of people to manage money and use financial services
for their own benefit. It thus pertains to the
ability to act
—
action performed (or not performed but deemed important)
by rural households in the context of money management
and use (Bickel and Mehwald, 2014).
15. Support for this hypothesis is provided by the case of the
Integrated Rural Development Programme (IRDP). About
38 to 40 million families received nearly 60 million IRDP
loans between 1980 and 1999—loan amounts that were
as high as the level of the annual household poverty line.
Nevertheless, due to deficiencies in implementation and a
range of factors which denied them the full benefit of the
proposed investments, a significant proportion of the bor-
rowers found themselves as defaulters of the banking system.
16. See Sarma (2008) for details of the methodology.
17. The project is funded by Bill and Melinda Gates Foundation.
See Demirguc-Kunt and Klapper (2012) for a detailed
discussion on the index.
18. The Mor Committee used the assumption that an individual
belonging to an urban area holding a bank account would be
holding on an average 4 bank accounts, and an individual
belonging to a rural area holding a bank account would be
holding on an average 1.5 bank accounts.
19. Including six new districts formed during the year. Data on
population of districts for 2009, 2010 and 2012 has been
estimated using population data as per Census of India 2001
and 2011.
20. Summary of findings of the Financial Inclusion Insights Study,
India: Financial Services Use and Emerging Digital Pathways
(source:
/
FII-India-Wave-One-Research-Report.pdf )
21. An adult who owns or has access to a digital account or
to digital financial services is considered to be financially
included.
22. Pertains to all bank accounts and mobile money accounts.
23. An individual is considered to have access to an account if
he/she has used either mobile money or bank services, at
least once, either via their own account or via an account of
another person.
24. A bank account or a mobile money account used in the last
90 days.
25. As in footnote 24.
26. Refers to adults living on less than $2.50 per day, as classified
by the Grameen Progress out of Poverty Index—a poverty
measurement tool developed by the Grameen Foundation
wherein a set of country-specific questions are used to com-
pute the likelihood that a household is living below the above
indicated poverty line.
27. Defined as use of a phone, which is either owned by the
respondent personally or borrowed from or paid to someone
else for use by the respondent.
28. Estimated total borrowing clients of microfinance institu-
tions and the number of members of SHGs with outstanding
bank loans under the SHG-Bank Linkage Programme as on
31 March 2014.
29. See Government of India (2014) for details of the Mission.
