The financial inclusion Inclusion Index (FI-Index) of the Reserve Bank of India (RBI) rose to 64.2 this March from to 60.1 in March 2023, showing growth across all parameters.
The improvement in the FI-Index reflects a deepening of financial inclusion across the country, the central bank said.
“The value of the index for March 2024 stands at 64.2 vis-à-vis 60.1 in March 2023, with growth witnessed across all sub-indices,” the RBI said in a statement on Tuesday. The improvement was mainly contributed by usage dimension, the statement added.
The FI-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. It comprises three broad parameters — access (with a weight of 35%), usage (45%), and quality (20%) — with each of these consisting of various dimensions, which are computed based on a number of indicators.
The annual FI-Index had earlier risen to 56.5 at the end of March 2022 from 43.4 for the fiscal ending March 2017, which reflects the steady rise in financial inclusion along with economic development that is taking place in the country.
The FI-Index has been conceptualised as a comprehensive index, incorporating details of banking, investments, insurance, postal, as well as the pension sector, in consultation with government and respective sectoral regulators. The index is responsive to ease of access, availability and usage of services, and quality of services.
According to the RBI, a unique feature of the index is the quality parameter, which captures the aspect of financial inclusion as reflected by financial literacy, consumer protection and inequalities and deficiencies in services.