Keeping track: RBI introduces financial inclusion index
1 min readThe Bank of the Indian Reserve on August 17 introduced an annual index to measure and improve the scope of financial inclusion in the country.
The Financial Inclusion Index (FI-INDEX), which will be published every month of July, will be an integral index that incorporates the details of banking, investments, insurance, postcard, as well as the pension sector in consultation with Government and sectoral regulators said the central bank at a launch.
The fixing index for the period ending March 2021 was 53.9 against 43.4 for the period ending March 2017.
The index captures information on different aspects of financial inclusion in a single value ranging between 0 and 100, where 0 represents financial exclusion and 100 indicates the complete financial inclusion, the Central Bank said.
The index comprises three general parameters: use (45 percent), access (35 percent) and quality (20 percent). These would be computed according to a series of indicators.
The index would respond to the ease of access, availability and use of services, and quality of services.
“A unique feature of the index is the quality parameter, which captures the aspect of the quality of financial inclusion that reflected by financial literacy, consumer protection and inequalities and deficiencies in services,” said RBI.
A base year has not been built, since it reflects the cumulative efforts of all stakeholders over the years towards financial inclusion, he said.
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