RBI unveils Financial Inclusion Index
- IBEF
- August 18, 2021
A Financial Inclusion Index (FI-Index) has been developed to measure the level of financial inclusion. On Tuesday, the Reserve Bank of India announced its establishment.
The annual FI-Index for the period ending March 2021 is 53.9, up from 43.4 for the same time in 2017, indicating a significant increase over the previous four years.
Every year in July, the index will be published.
The data on various elements of financial inclusion will be summed up into a single number between 0 and 100, with 0 indicating complete financial exclusion and 100 indicating complete financial inclusion.
The index, which will include 97 factors, will be sensitive to ease of access, availability and consumption of services, and service quality. It will also take into account the quality of financial inclusion, as evidenced by financial literacy, consumer protection, and inequities and service inadequacies.
It will collect information on banking, investing, insurance, postal service, and pensions to determine the level of financial inclusion.
The FI-Index is made up of three main parameters: access (35% weightage), usage (45% weightage), and quality (20% weightage), each of which has several aspects that are calculated using a variety of indicators.
Because there is no base year, it would represent all stakeholders' efforts throughout time to achieve financial inclusion.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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