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Daily News Analysis

FINANCIAL INCLUSION INDEX (FI-INDEX)

3rd August, 2022 Economy

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Context

  • The Reserve Bank of India's composite financial inclusion index (FI-Index) capturing the extent of financial inclusion across the country rose to 56.4 in March 2022, showing growth across parameters.

The Index

  • Reserve Bank of India’s (RBI) financial inclusion (FI) index, was constructed to capture the extent of financial inclusion across the country.
  • The index captures information on various aspects of financial inclusion in a single value ranging between 0 and 100, where 0 represents complete financial exclusion and 100 indicates full financial inclusion.
  • The FI index was conceptualised as a comprehensive index incorporating details of banking, investments, insurance, postal as well as the pension sector in consultation with the government and respective sectoral regulators.
  • The FI-Index has been constructed without any ‘base year', and is published in July every year. The FI-Index comprises three broad parameters:
  1. Access, with a weightage of 35 per cent;
  2. Usage with 45 per cent weightage; and
  3. Quality with 20 per cent weightage
  • It incorporates details of banking, investments, insurance, postal as well as the pension sector.
  • The Index is responsive to ease of access, availability and usage of services, and quality of services.

 

https://economictimes.indiatimes.com/news/economy/indicators/rbis-financial-inclusion-index-rose-to-56-4-in-march-2022/articleshow/93302283.cms

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