NEW DELHI: India is now ahead of China in financial inclusion metrics, as the number of persons with deposit accounts at banks has significantly increased, comparable with emerging economy peers and even some of the advanced economies, says a latest report by the SBI Ecowrap.
According to the report, written by Soumya Kanti Ghosh, group chief economic adviser at State Bank of India (SBI), online banking transactions rose to 13,615 per 1,000 adults in 2020 from 183 in 2015 and the number of bank branches inched up to 14.7 per 1 lakh adults in 2020 from 13.6 in 2015, which is higher than Germany, China and South Africa.
The SBI report also added that during the past seven years of the financial inclusion drive, the number of no-frills bank accounts opened has reached 43.7 crore with Rs 1.46 lakh crore in deposits as of October 20, 2021.
Of these, nearly two-thirds are operational in rural and semi-urban areas and over 78% of these accounts are with state-owned banks, 18.2% with regional rural banks, and a paltry 3% are opened by private sector banks.
During this period, the number of bank branches in rural areas has increased from 33,378 in March 2010 to 55,073 in December 2020. The number of banking outlets in villages and banking correspondents (BCs) has soared from 34,174 in March 2010 to 12.4 lakh in December 2020.
During this period, the number of commercial bank branches per one lakh adults rose from 13.5 to 14.7. The number of deposit accounts with banks rose from 1,536 to 2,031, the number of loan accounts from 154 to 267, and the number of mobile and internet banking transactions rose from 183 to 13,615. The RBI in January 2016 allowed the business correspondent model of branchless banking.
“It is sometimes observed that there is no uniformity among the BCs across banks regarding adherence to the above guidelines. PSBs mostly follow ‘branch-led BC model’, while other banks follow ‘branch less/corporate BC model,” the report said adding there should be rationalisation in interchange fee as there is no level playing field in infrastructure by all banks.
Meanwhile, the finance ministry has said that the number of PM Jan Dhan accounts have trebled to 43.76 crore over the last 6 years. In March 2015, there were 14.72 crore such accounts. The ministry also informed that 31.67 crore reupay debit cards with inbuilt accident insurance coverage issued to Jan dhan account holders till October 21.
