Financial inclusion is only a part of inclusive growth, said S.A. Bhat, chairman and managing director, Indian Overseas Bank, who was speaking at Mint’s Clarity Through Debate event on Inclusion: Key to Growth for Banking and Industry. Other speakers at the debate, which included K.V. Eapen, joint secretary, Union finance ministry; T.T. Srinivasaraghavan, managing director, Sundaram Finance Ltd; J.M. Garg, chairman and managing director, Corporation Bank; M.S. Sundara Rajan, chairman and managing director, Indian Bank; A. Vellayan, chairman, Murugappa Group; Nachiket Mor, president, ICICI Foundation; and M.F. Farooqui, principal secretary, ministry of industries, Tamil Nadu government, tended to agree with this view. The discussion was moderated by deputy managing editor Tamal Bandyopadhyay:
Different angle: (from left) K.V. Eapen, joint secretary, Union finance ministry; T.T. Srinivasaraghavan, MD, Sundaram Finance; J.M. Garg, CMD, Corporation Bank; M.S. Sundara Rajan, CMD, Indian Bank; Tamal Bandyopadhyay, deputy managing editor, Mint; A. Vellayan, chairman, Murugappa Group; Nachiket Mor, president, ICICI Foundation (not seen in the picture); S.A. Bhat, CMD, Indian Overseas Bank; and M.F. Farooqui, principal secretary, government of Tamil Nadu, at Mint’s Clarity Through Debate event in Chennai on Monday. Ganesh Muthu / Mint
We have been talking about inclusive growth but actually there is neither growth nor inclusion. Why is this happening?
Eapen: Seriously, perhaps, we have started looking at financial inclusion only around three years back and the initiative has come in with the Rangarajan committee, which looked into this whole issue and it pointed out basically that a large number of Indians are not having access to any sources of informal sources of finance, forget about the formal sources of finance. So, when this happened, that was the catalyst really about three years back for the Reserve Bank of India to bring in certain guidelines about opening of accounts, which are what they called the no-frills variety or accounts where the balance could be close to zero or very low. But that, as has been mentioned in the opening remarks, is something which is not enough. Essentially, financial inclusion is a topic which goes beyond just bank accounts; it’s essentially access to financial instruments. Now that’s where India has been very poor. We seriously haven’t been looking at this issue for a long time and this is something that all of us here, represented here by the panel, which is the private sector as well as the banks and the government, have a major role. The short point that I want to end with any initiative in this area necessarily needs to be technologically driven. Technology is the key to financial inclusion. Right now, we have this talk where ….