Question

What is 'financial inclusion'?
A. Easy access to bank accounts for safe parking of savings
B. Availability of cheap credits through appropriately designed loans for poor and low income households and small entrepreneur
C. Availability of basic financial products like insurance

• A. Only (A)
• B. Only (B)
• C. Only (C)
• D. Both (A) and (B)

Answer 1

The correct option is B Only (B)

Financial Inclusion: Financial inclusion refers to delivery of banking services at an affordable cost to the vast sections of disadvantaged and low-income groups who tend to be excluded from the formal banking channel. Despite widespread expansion of the banking sector during the last three decades, a substantial portion of the households, especially in rural areas, is at present outside the coverage of the formal banking system. RBI's broad approach to financial inclusion aims at "connecting people" with the banking system and not just credit dispensation; giving people access to the payment system; and portraying financial inclusion as a viable business model and opportunity.