Indian economy in general and banking services in particular have made rapid strides in the recent past. However, a sizeable section of the population, particularly the vulnerable groups, such as weaker sections and low income groups, continue to remain excluded from even the most basic opportunities and services provided by the financial sector. In order to address the issues of financial inclusion, the Government of India constituted a “Committee on Financial Inclusion” under the Chairmanship of Dr. C. Rangarajan. The Committee submitted its final report to Hon'ble Union Finance Minister on 04 January 2008.
The Committee on Financial Inclusion has defined Financial Inclusion as "the process of ensuring access to financial services and timely and adequate credit where needed by vulnerable groups such as weaker sections and low income groups at an affordable cost.”
Among others, the Committee has recommended setting up of two funds - Financial Inclusion Fund (FIF) and Financial Inclusion Technology Fund (FITF). The two funds have been established with NABARD, which is the coordinating agency of Financial Inclusion initiatives with Financial Inclusion Department (FID) as the nodal department.
Core Business of Department
The core activities of the Department are to carry forward the agenda of financial inclusion of the excluded population at the national level as per the framework described by the Report of the Committee on Financial Inclusion in general and operationalising the Financial Inclusion Fund (FIF) and Financial Inclusion Technology Fund (FITF), in particular. The implementation is under the guidance of the two Advisory Boards set up for FIF and FITF respectively.